FOMC Begins Tuesday, Interest Rate Decision on Wednesday 

July 29, 2019
By Vlad Karpel

Major U.S indices are trading to mixed results today as China and U.S. trade representatives meet in Shanghai for the first face to face since both Presidents met in Japan during the G20 summit. This comes in the midst of Q2 earnings season where stocks have reached record highs. Major earnings to monitor this week include Apple, Mastercard, Qualcomm, General Electric, Verizon, and Exxon earnings as well as core inflation data, employment cost index, and June trade deficit report. Headlining this week will be the FOMC meeting where the feds will decide between keeping rates at their current level or introducing a rate cut. Powell will meet with the press following the conclusion of the two-day meeting which could create volatility. The FOMC and Q2 earnings are the biggest factors to the markets this week but we do not see market momentum pushing SPY much higher than $300, potentially overshooting to $305. The SPYcontinues to trade near an all-time high level and we encourage our readers to avoid chasing near $300 level and consider buying closer to $290. For reference, the SPY Seasonal Chart is shown below:

All eyes this week will be on the two-day FOMC were an interest rate cut is expected after comments from Fed Chair Powell as well as last month’s FOMC minutes indicated most members of the Fed were in favor of a rate cut. Last week’s GDP data also supported the growing speculation the Feds will cut rates as positive earnings, growth, and labor data continue improving economic conditions in 2019. A policy update decision and Powell press conference will come out Wednesday after the conclusion of the two-day meeting. Other key economic reports to monitor this week include July employment data, Q2 employment cost index, core inflation, and trade deficit data. Apart from these economic reports, Q2 corporate earnings remain in focus with five hundred reports this week. Tuesday’s earnings are headlined by Apple and Mastercard, and will also include Procter & Gamble, Pfizer, GrubHub, ConocoPhillips, Under Armour, and ELectronic Arts. On Wednesday look for General Electric, Humana, and Spotify data before markets open, Qualcomm after markets close. Closing out the big week of earnings will be General Motors, Kellogg, Marathon Petroleum, Verizon, Yum! Brands, Chevron, and Exxon. 

Globally, Asian markets are trading modestly lower while European markets are split. U.S. Trade Representative Lighhozer and Mnuchin are scheduled to meet with Chinese officials in Shanghai tomorrow. Tariff negotiations and trade deficit will be discussed as both sides look to avoid further tariffs. The meeting is scheduled for two days and will look to build progress off the goodwill actions both nations have taken since meeting in the G20. China’s economy took a step back in July as several economic reports have shown a slow down in growth and revenue, with exports shrinking by 13%. Over in the U.K., the pound hit a new two-year low as the lack of progress on Brexit continues to weigh on the British and European economies. The next Brexit deadline is scheduled for October, which continues to seem less likely unless major developments occur in the coming weeks. 

Using the “^GSPC” symbol to analyze the S&P 500 our 10-day prediction window shows mixed signals. Today’s vector figure of +0.17% moves to -1.03% in five trading sessions. Prediction data is uploaded after the market close at 6 pm, CST. Today’s data is based on market signals from the previous trading session.  


Here’s the short version of what our Premium Service can do for you:
Trailing 36-month return. . . 1,276%!

What people are saying about Tradespoon:

Mauricio F.
Member since August 2017

I really like your site and am learning from the videos. I made several good profitable trades following your site recommendations and advice.?

I used your site advice to buy 3 Netflix (NFLX) call options. I Paid $8.20 for two $270 call options 16 Feb...

A half-hour later they were selling for $10.50! Your site predicted that NFLX would increase in price. I decided to buy one more of the same option and paid $10.30. Friday the Bid = $11.65 and Ask = $11.95... I calculated that the gain is so far is about 17% against the money that I used to purchase the options.

CLICK HERE TO LEARN MORE


Highlight of a Recent Winning Trade

On July 17th, our ActiveTrader service produced a bullish recommendation for AES Corporation (AES). ActiveTrader is included in all paid Tradespoon membership plans and is designed for day trading.

Trade Breakdown

AES entered its forecasted Strategy B Entry 1 price range $17.29 (± 0.07) in its first hour of trading and passed through its Target price $17.46 in the second hour of trading that day. The Stop Loss price was set at $17.12


Tuesday Morning Featured Symbol

*Please note: At the time of publication we do not own the featured symbol, PNC. Our featured symbol 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 MonthlyTrader recommendations. If you are interested in receiving Vlad’s personal picks, please click here.

Our featured symbol for Tuesday is PNC Bank (PNC). PNC 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.  

The stock is trading at $143.36 at the time of publication, up 1.79% from the open with a +0.39% 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 the 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 Crude Oil delivery (CL.1) is priced at $56.78 per barrel, up 1.03% from the open, at the time of publication.

Looking at USO, a crude oil tracker, our 10-day prediction model shows negative signals. The fund is trading at $11.8 at the time of publication, up 1.29% from the open. Vector figures show -0.17% today, which turns -3.36% 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 the Gold Continuous Contract (GC00) is up 0.21% at $1,422.30 at the time of publication.

Using SPDR GOLD TRUST (GLD) as a tracker in our Stock Forecast Tool, the 10-day prediction window shows mostly negative signals. The gold proxy is trading at $134.22, up 0.43% at the time of publication. Vector signals show -0.15% 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

The yield on the 10-year Treasury note is down 0.51% at 2.06% at the time of publication. The yield on the 30-year Treasury note is down 0.32% at 2.59% 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 +0.06% moves to +0.03% 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 6.33% at $12.93 at the time of publication, and our 10-day prediction window shows mixed signals. The predicted close for tomorrow is $12.70 with a vector of +3.52%. 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.


Here’s the short version of what our Premium Service can do for you:
Trailing 36-month return. . . 1,276%!

What people are saying about Tradespoon:

Mauricio F.
Member since August 2017

I really like your site and am learning from the videos. I made several good profitable trades following your site recommendations and advice.?

I used your site advice to buy 3 Netflix (NFLX) call options. I Paid $8.20 for two $270 call options 16 Feb...

A half-hour later they were selling for $10.50! Your site predicted that NFLX would increase in price. I decided to buy one more of the same option and paid $10.30. Friday the Bid = $11.65 and Ask = $11.95... I calculated that the gain is so far is about 17% against the money that I used to purchase the options.

CLICK HERE TO LEARN MORE


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