One of the biggest stories of this week is the debut of Bitcoin futures trading on the Chicago CBOE this past Sunday evening. Traffic was so heavy that the CBOE website had gone down temporarily, and we saw price jumps so sharp that two halts were needed. You’ll likely see a cacophony of praise and warnings for this new market component, as well as a series of mergers and moves by new and established companies involved in blockchain and cryptocurrency technology.
One major trend is likely to run through this new cryptocurrency boom. We’ll see opportunistic moves to integrate the technology into existing industries as public understanding grows for real-world blockchain business applications. We’ll also likely to see new industry-specific cryptocurrencies emerge to the forefront as they become turnkey solutions for business obstacles.
In central banking news, investors are looking to a round of announcements both internationally and domestic. Policy announcements are due later this week from the European Central Bank and the Bank of England. In the U.S., the Fed will be updating a policy statement within two days. The final interest-rate hike for the year is drawing near and market participants are gearing up for that, following a better-than-expected nonfarm-payroll data release for the month of November.
Tech shares saw a boost today, supported by leading chip makers such as Nvidia Corp. (NVDA), Advanced Micro Devices (AMD) and Microchip Technology Inc. (MCHP). Although most will attribute this to the cryptocurrency wave- and that may be true- there are lesser-known non-chip maker stocks to focus on in the near term. One example is Digital Power (DPW). Digital Power builds power-supply technology for energy-heavy computer applications and has recently pivoted to address the new demand for cryptocurrency mining and farming operations. The stock is up 5.45% at the time of publication. Identifying nascent ventures and lower-cap stocks that fit into the larger blockchain ecosystem is important for successfully navigating this new industry.
At the time of publication, the DJIA is up 0.08%, or 18.41 points, at 24,347. The S&P 500 is trading at 2,655- up 0.14% from the open. The Nasdaq-100 is up 0.33% at 6,862.
Using the ^GSPC symbol to analyze the S&P 500, our 10-day prediction window shows initial, slight downward correction followed by a gradual upturn. Today’s negative vector figure of -0.05% reverses to +0.02% within four trading sessions and rises from there. Today’s predicted support and resistance is 2,640.05 (± 3.75) and 2,651.50 (± 3.76), respectively. The predicted close today is 2,645.50. 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 December 8, our ActiveTrader service- which is included in all Tradespoon membership plans- generated a bullish trade for ConocoPhillips (COP). Our ActiveTrader service is designed for intraday trading.
Within the first hour of trading, COP hit the higher end of the Entry 1 ($50.54, ± 0.22) price range and moved through its Target of $51.05. The Stop Loss was set at $50.03.
Our must-buy stock for Tuesday is Facebook Inc. (FB). The stock is showing a near-term opportunity for gains 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 relative to our entire data universe. Our 10-day prediction model shows vector figures climbing above +2.00% within the next trading session. Our benchmark for vector figures is +1.00%.
The stock is trading at $179.55 at the time of publication, up 0.31% from the open with a +1.92% vector figure.
Tuesday’s prediction shows an open price of $185.39, a low of $182.05 and a high of $187.42.
The predicted close for Tuesday is $182.87. Vector figures show +2.24% for tomorrow which hold positive for several trading days before a predicted downturn. This is a good signal for trading opportunities, because the vectors are a primary factor in determining price movements for stocks and ETF.
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 relatively to average of actual prices for last trading session. The column shows expected average price movement “Up or Down”, in percent. Trend traders should trade along predicted direction of the Vector. The higher the value of the Vector the higher its momentum.
Crude prices finding support from better-than-expected U.S. economic data, which is working to balance out worries around accelerated U.S. shale production. Non-OPEC members, particularly the U.S., tend to take advantage of the oil cartel’s global production cut accord struck last November. The deal has been extended into next year, which helped to firm up prices although details were sparse on the exact timeline and complaints figures.
West Texas Intermediate for January delivery is priced at $57.71 per barrel at the time of publication, up 1.03% from the open.
Looking at USO, a crude oil tracker, our 10-day prediction model shows overall positive signals. The fund is trading at $11.57 at the time of publication, up 0.70% from the open. Today’s prediction sees support at $11.45 (± 0.06) and resistance at $11.67 (± 0.06). The predicted close for today is $11.58. Vector figures show +0.50% today, moving to +0.89% in three 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 February gold is down 0.06% at $1,248.10 a troy ounce at the time of publication. The perceived safe-haven metal had seen a slight bump earlier due to U.S. dollar weakness and news of an attempted suicide bombing at a New York City Port Authority bus terminal. These gains were hampered, however, by strong equities performance and the Chicago CBOE launch of its Bitcoin futures trading. Investors are also looking forward to an expected Fed interest-rate hike and passing of a tax-reform plan.
Using SPDR GOLD TRUST (GLD) as a tracker in our Stock Forecast Tool, the 10-day prediction window shows strong negative signals. The gold proxy is trading at $118.22, down 0.22% at the time of publication. Today’s predicted low is $117.39 (± 0.23) and the predicted high is $118.48 (± 0.24). The predicted close today is $117.58. 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.
Yields are down today as investors prepare for new issuances after an expected December interest-rate hike announcement from the Fed this Wednesday. The Treasury Department is also auctioning off a great deal of debt at the time of publication. $24 billion in 3-year notes is currently underway and next up is an auction of $20 billion worth of 10-year notes. The yield on the 10-year Treasury note is down 0.26% at 2.37% 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. Today’s vector of +0.04% drives down for several trading days and continues to fluctuate throughout the forecast. The ETF is priced at $126.80 at the time of publication, up 0.09%. The predicted close today is $126.75 with a low and high of $126.18 (± 0.23) and $126.81 (± 0.23), respectively. 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 flat from the open at 9.58 at the time of publication, and our 10-day prediction window shows overall positive movement. The predicted close today is 9.59 with a negative vector of -0.19%, which moves to +5.11% in three trading sessions. Today’s predicted lows and highs are 9.56 (± 0.21) and 10.21 (± 0.23), respectively. 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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