Major indexes see a rebound following positive private sector jobs data, while investors look toward March Fed minutes and non-farm payroll reports

April 5, 2017
By Vlad Karpel

U.S stocks have seen a boost today following an exceptional private sector jobs report. ADP reports that employers added 263,000 jobs in March, which is up from February’s revised figure of 245,000. Analysts tend to look at this report to gauge the results of the non-farm payroll report, which is due this Friday.

Investors are also looking toward incoming minutes from a Federal Reserve meeting for guidance. In particular, most are interested to know whether or not the Fed will eventually slow rate hikes. The minutes from this meeting are to be released at 2 p.m. Eastern Time. With positive economic data like this, it is possible that Fed officials may be more inclined to maintain or raise the rate of hikes.   

U.S President Donald Trump will begin a two-day summit with Chinese President Xi Jinping this Thursday. Investors are looking to gleam any details from these talks for guidance on the trade relationships, as well as the U.S dollar. On the geopolitical front- markets appeared barely impacted by another North Korean ballistic missile test and a deadly chemical weapons attack in Syria. Investors tend to move to defensive positions during geopolitical turmoil or uncertainty.

The Dow is currently up 0.74%, or 112 points, at 20,843. The Nasdaq-100 is up 0.54% at 5,930 and the S&P 500 is currently trading at 2,375.19 which is up 0.63% from the open.

Using the ^GSPC symbol to analyze the S&P 500, our 10-day prediction window shows consistent positive movement. Today’s positive vector figure of +0.19% proceeds toward +0.70% in three trading sessions. Today’s support and resistance is 2,355.74 (± 3.58) and 2,367.36 (± 3.60), respectively. The predicted close today is 2,360.63.   



We see the typical push and pull activity in crude oil markets today, as a short rally is struggling to stay afloat following boosts in U.S crude supplies. The U.S Energy Information Administration reported a rise of 1.6 million barrels last week. On Tuesday, however, the American Petroleum Institute had estimated a decline of 1.8 million barrels. A Wall Street Journal analyst survey had also pointed to expected declines in U.S crude inventories, making today’s  jump a shock to investors. The counter-weight to this news, which dampened bullish sentiment, is an tentative agreement between major OPEC countries to extend production-cuts past June. West Texas Intermediate for May delivery is currently priced at $51.28 per barrel, up 0.50% from the open.

Looking at USO, a crude oil tracker, our 10-day prediction model shows upward movement building incrementally. The fund is currently trading at $10.73, which is up 0.19% from the open. Today’s prediction sees support at $10.71 (± 0.07) and resistance at $10.89 (± 0.07). The predicted close for today is $10.85. Vector figures show +1.15% for today, then build to above +4% within four trading sessions. All vector figures are based on today’s market conditions.  



The price for June gold is down 0.75% at $1,249.20 a troy ounce. The yellow metal is struggling to maintain the $1,250 mark following positive private sector jobs data. Gold is perceived as a safe-haven asset, so investors turn away when market conditions appear more suitable for investment. Additionally, positive economic news can lead to speculation of faster Fed rate hikes. This is detrimental to the non-fiat asset as it does not produce a yield for investors.  

Using SPDR GOLD TRUST (GLD) as a tracker in our Stock Forecast Tool, the 10-day prediction window shows mostly slight positive movement. The gold proxy is currently trading at $118.63, down 0.83% from the open. Today’s predicted low is $119.32 (± 0.30) and the predicted high is $120.45 (± 0.30). The predicted close today is $119.71. Relative to today’s conditions, vectors shift from +0.15% today to +0.73% within three trading sessions.  



Bond prices have fallen and yields are up, following strong private-sector jobs reports Wednesday. The yield on the 10-year Treasury note is up 0.15%, currently trading at  2.36%. Investors are also considering the likelihood that the Fed will be giving signals to their next rate hike. Expectations of Fed interest rate hikes can devalue current bond prices.

Using the iShares 20+ Year Treasury Bond ETF (TLT) as a proxy for bond prices in our Stock Forecast Tool, we see negative signals building incrementally in our 10-day prediction window. Relative to today’s conditions, we see vector figures easing from -0.49% today to -0.15% in three trading sessions before building back up to above -1%.  The ETF is currently priced at $120.76- down 0.21% from the open. The predicted close today is $120.30 with a low and high of $119.75 (± 0.27) and $121.47 (± 0.27), respectively.  



The CBOE Volatility Index (VIX) is currently down 7.04% from the open at 10.96. Relative to today’s conditions, the 10-day prediction window shows mixed movement with mostly negative signals. The predicted close today is 11.87 with a negative vector of -2.42%. Today’s predicted lows and highs are 11.24 (± 0.17) and 13.18 (± 0.20), respectively.


Other News

Panera Bread Co. (PNRA) is seeing significant boosts in their share prices, following an announcement that the restaurant chain will be acquired by privately-held JAB in a deal worth $7.5 billion. The stock is currently trading at $311.89 which is up 13.82%, or $37.90,  from the open.

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