Social Media Outages and Oil Rally Provoke Market Dip
U.S. markets unanimously finished lower as the VIX returned to the $25 level. Inflation concern and COVID data remain at the forefront of market movement while today’s selloff was led by a large dip in the tech sector. Widespread social-media and tech outages, headlined by Facebook, caused shares to dip significantly, alongside the release of the Pandora Papers, causing some concern as information continues to be parsed.
We recommend watching the critical support levels on the SPY at $428 and $420 as the bottoming process continues. PEP, CAG are key earnings announcements this week while employment data will be the main event that can determine the next move in the market. We encourage all market commentary readers to maintain clearly defined stop levels for all positions. For reference, the SPY Seasonal Chart is shown below:
Key economic reports this week will feature substantial employment data that could potentially influence the market’s next move. U.S.-China relations once again could dictate market movement as the Evergrande fallout continues; Evergrande is now planning on selling its property management sector. Factory orders report for the U.S. in August, topping expectations. Oil shares rallied causing some concerns about a continued bottoming process or potential black swan event. Globally, Asian markets traded to mixed results while European markets closed in the red.
Key U.S. Economic Reports/Events This Week:
- Factory Orders (August) – Monday
- Trade Deficit (August) – Tuesday
- ISM Services Index (September) – Tuesday
- ADP Employment (September) – Wednesday
- Weekly Jobless Claims (10/2) – Thursday
- Consumer Credit (August) – Thursday
- Nonfarm Payrolls (September) – Friday
- Unemployment Rate (September) – Friday
- Average Hourly Earnings (September) – Friday
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For reference, the S&P 10-Day Forecast is shown below:
Using the “^GSPC” symbol to analyze the S&P 500 our 10-day prediction window shows a near-term mixed outlook. Prediction data uploaded after the market closes at 6 p.m. CST. Today’s data is based on market signals from the previous trading session.
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Tuesday Morning Featured Symbol
Our featured symbol for Tuesday is American Airlines Group (AAL). AAL is showing a steady vector in our Stock Forecast Toolbox’s 10-day forecast.
The symbol is trading at $21.65 with a vector of -0.93% at the time of publication.
10-Day Prediction data uploaded after the market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
Note: The Vector column calculates the change of the Forecasted Average Price for the next trading session relative to the average of actual prices for the last trading session. The column shows the expected average price movement “Up or Down”, in percent. Trend traders should trade along the predicted direction of the Vector. The higher the value of the Vector the higher its momentum.
*Please note: At the time of publication Vlad Karpel does have a position in the featured symbol, aal. Our featured symbol is part of your free subscription service. Not included in any paid Tradespoon subscription service. Vlad Karpel only trades his money in paid subscription services. If you are a paid subscriber, please review your Premium Member Picks, ActiveTrader, or MonthlyTrader recommendations. If you are interested in receiving Vlad’s picks, please click here.
Oil
West Texas Intermediate for Crude Oil delivery (CL.1) is priced at $77.62 per barrel, up 2.29% at the time of publication.
Looking at USO, a crude oil tracker, our 10-day prediction model shows mixed signals. The fund is trading at $53.26 at the time of publication. Prediction data uploaded after the market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
Gold
The price for the Gold Continuous Contract (GC00) is up 0.60% at $1768.90 at the time of publication.
Using SPDR GOLD TRUST (GLD) as a tracker in our Stock Forecast Tool, the 10-day prediction window shows mixed signals. The gold proxy is trading at $164.59 at the time of publication. Vector signals show +0.34% for today. Prediction data uploaded after the market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
Treasuries
The yield on the 10-year Treasury note is up, at 1.483% at the time of publication.
The yield on the 30-year Treasury note is up, at 2.046% at the time of publication.
Using the iShares 20+ Year Treasury Bond ETF (TLT) as a proxy for bond prices in our Stock Forecast Tool, we see mixed signals in our 10-day prediction window. Prediction data uploaded after the market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
Volatility
The CBOE Volatility Index (^VIX) is $22.96 at the time of publication, and our 10-day prediction window shows mixed signals. Prediction data uploaded after the market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
