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Major U.S. Indexes are down today after the recent interest rate hike weighed on stocks heavily throughout last week. Banks will announce earnings on Friday which will hopefully help settle markets. Interest-sensitive sectors are on the move as Homebuilders, Emerging Markets, and Automotive sectors are at a 52 week low. Fifty-day moving averages on SPY are at $286 which is a key support level. QQQ support is $177, with the hundred-day moving average, accounting for the lower Bollinger band as its key support. Treasury yields continue to rise, a likely key motivator in the recent selloff. SPY Seasonal Chart forecast is shown below:
Yields continue to rise behind the recent FOMC-announced interest rate hike which was the third of this year’s planned four. Fed Chairman Jerome Powell indicated a fourth would likely come from the December meeting and while the previous two hikes were kinder to bond yields, the third interest rate hike of the year seemed to have the opposite effect. Continue watching fifty-day moving averages and yield movement as the recent selloff comes ahead of the latest earnings season.
Major banks will announce Friday which should help support some recovery if positive. Last week’s labor report, although positive, did not help deter the selloff but is a continuation of ongoing positive economic reports we have received for most of 2018. With labor, production, and earnings up this year has shaped up to be fairly bullish, even in the midst of the recent selloff. Both Asian and European markets are down today, continuing last week’s negative trend.
Using the “^GSPC” symbol to analyze the S&P 500, our 10-day prediction window shows mixed signals. Today’s vector figure of -0.10% moves to +0.19% in five trading sessions. The predicted close for tomorrow is 2,901.68. 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 October 2nd, our ActiveTrader service produced a bearish recommendation for Weyerhaeuser Co (WY). ActiveTrader included in all Tradespoon membership plans and is designed for intraday trading.
Trade Breakdown
WY entered the forecasted Entry 1 price range of $32.14 (± 0.14) in its second to the last hour of trading and moved through its Target price of $31.82 in its first hour of trading the following day. The Stop Loss was set at $32.46.
Our featured stock for Tuesday is Philip Morris Intl Inc. (PM). MMM is showing a confident vector trend in our Stock Forecast Toolbox’s 10-day forecast. This stock is assigned a Model Grade of (B) indicating it ranks in the top 25th 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 $84.81 at the time of publication, up 0.84% from the open with a +0.13% 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.
West Texas Intermediate for October delivery (CLX8) is priced at $74.23 per barrel, down 0.13% from the open, at the time of publication. Looking at USO, a crude oil tracker, our 10-day prediction model shows positive signals. The fund is trading at $15.68 at the time of publication, down 0.06% from the open. Vector figures show 0.47% today, which turns +3.65% 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.
The price for December gold (GCZ8) is down 1.28% at $1,190.20 at the time of publication. The U.S. Dollar Index (DXY) is up 0.15% at $95.75. Gold and the dollar typically move inversely of each other. Using SPDR GOLD TRUST (GLD) as a tracker in our Stock Forecast Tool, the 10-day prediction window shows all positive signals. The gold proxy is trading at $112.34, down 1.28% at the time of publication. Vector signals show +0.10% 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.
The yield on the 10-year Treasury note is up 1.37% at 3.23% at the time of publication. The yield on the 30-year Treasury note is up 0.05% at 3.40 % 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 negative signals in our 10-day prediction window. Today’s vector of -0.46% moves to -0.09% 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.
The CBOE Volatility Index (^VIX) is up 7.35% at $15.91 at the time of publication, and our 10-day prediction window shows negative signals. The predicted close for tomorrow is $14.15 with a vector of -6.24%. 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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