U.S. Stocks Lower Amid Global Oil Concerns
Bond markets are closed today for Veterans Day observance while major U.S. indices are open and down today. Although all three major U.S. indices ended the week in decline, all three actually made gains for the week that featured both midterm elections, which split Congress, and the Federal Reserve meeting, which did not increase interest rates. While last week’s retreat was subtle, today assets are trading sharply lower, most notably due to the wavering oil market which saw sharp declines. Two major factors pressuring oil include the Iran sanctions which kicked in last week and Saudi Arabia recent announcement to cut global production, pointing to a likely decline in production with all other OPEC-associated nations. With earnings mostly behind us, it will be interesting to see how the market will take to further global or geopolitical news. The next FOMC meeting is planned for December and will likely introduce the fourth and final interest rate hike of 2018. Investors should avoid chasing the market, at its current state the short-term market looks to be overbought. Buy into the dips and monitor volatility which could last another two weeks. Major support is at $270 while resistance is at $282. For reference, the SPY Seasonal Chart is shown below:
Later this month, President Trump is set to meet with Chinese President Xi, amongst other world leaders at the G20 summit, and will likely continue discussing tariffs and trades to some extent. So far both sides have lobbied pretty harsh tariffs against one another and have not shown signs of slowing down, with more likely tariffs planned. Globally, Asian markets are up while European markets have lowered today.
Apple shares lowered after earnings were released and news continued to surround the stock as to the likely changes going forward. Analysts have continued to reduce earnings estimates for the tech giant in 2019. Elsewhere, Alibaba easily topped their biggest day of sales, surpassing the $25.3 billion amassed last year on the online-retailers “Singles Day” sale, with $30.8 billion in sales. Still, the conglomerate lost steam today, with shares down almost 2%.
Economic reports to monitor this week include the consumer-price index for October on Wednesday; jobless claims, retail sales, import price reports are due on Thursday; and on Friday, industrial production and capacity utilization reports are scheduled for release. The heavy week of reporting will also include a speech from Fed Chairman Powell on Wednesday at the Dallas Federal Reserve regarding U.S. and global economic conditions.
Using the “^GSPC” symbol to analyze the S&P 500, our 10-day prediction window shows mixed signals. Today’s vector figure of -0.41% moves to +3.62% in five trading sessions. The predicted close for tomorrow is 2,770.50. Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
Highlight of a Recent Winning Trade
On November 7th, our ActiveTrader service produced a bullish recommendation for Starbucks Corp. (SB UX). ActiveTrader is included in all Tradespoon membership plans and is designed for intraday trading.
Trade Breakdown
SBUX entered the forecasted Entry 1 price range of $66.01 (± 0.66) in its first hour of trading and hit its Target price of $66.67 that hour, reaching a high of $68.14 for the trading day. The Stop Loss was set at $65.35.
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Tuesday Morning Featured Stock
Our featured stock for Tuesday is PepsiCo Inc (PEP). PEP is showing a confident vector trend in our Stock Forecast Toolbox’s 10-day forecast. This stock is assigned a Model Grade of (A) indicating it ranks in the top 10th percentile for accuracy for predicted support and resistance, relative to our entire data universe.
*Please note: Our featured stock is part of your free subscription service. It is not included in any paid Tradespoon subscription service. Vlad Karpel only trades his own personal money in paid subscription services. If you are a paid subscriber, please review your Premium Member Picks, ActiveTrader or ActiveInvestor recommendations. If you are interested in receiving Vlad’s personal picks, please click here.
The stock is trading at $116.96 at the time of publication, down 0.44% from the open with a +0.16% vector figure.
Prediction data is uploaded after 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 next trading session relative to the average of actual prices for the last trading session. The column shows 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.
Oil
West Texas Intermediate for December delivery (CLZ8) is priced at $58.82 per barrel, down 2.33% from the open, at the time of publication. Looking at USO, a crude oil tracker, our 10-day prediction model shows mostly negative signals. The fund is trading at $12.48 at the time of publication, down 1.73% from the open. Vector figures show +0.01% today, which turns -3.09% in five trading sessions. Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
Gold
The price for December gold (GCZ8) is down 0.59% at $1,201.50 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 $113.66, down 0.72% at the time of publication. Vector signals show +0.27% for today. Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
Treasuries
Using the iShares 20+ Year Treasury Bond ETF (TLT) as a proxy for bond prices in our Stock Forecast Tool, we see negative signals in our 10-day prediction window. Today’s vector of -0.11% moves to -0.70% in three sessions. Prediction data is uploaded after 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 up 18.32% at $20.54 at the time of publication, and our 10-day prediction window shows mixed signals. The predicted close for tomorrow is $17.82 with a vector of +3.39%. Prediction data is uploaded after market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.
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YOU NEED TO ACT NOW TO JOIN ME
TOMORROW AS WE GET READY TO RACK UP GAINS OF UP
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THE TIME:
4:30 PM Eastern Time
(1:30 PM Pacific)
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