From China to Syria, as one Geopolitical front cools another heats up

After a promising Tuesday that saw all 11 primary S&P 500 sectors and all 30 Dow Jones stocks making gains after China-U.S. tension eased, powered by Exxon, Boeing, and Intel strong gains, early Wednesday trading saw both indexes along with the Nasdaq trading lower. Yesterday’s market boost came from encouraging words, or rather no discouraging-harder-on-trade dialogue, from Chinese President Xi at the Boao Forum.  President Trump commended Xi on Twitter after his speech for sticking with his planned announcement of decreasing tariffs while making Chinese markets more accessible. The somewhat positive back and forth between these two has encouraged investors but the uptick didn’t stick long as geopolitical turmoil continues to affect markets.

After the Syrian chemical attack that took place over the weekend, U.S. and Russia tensions are heating up again as Trump doubled down on his intention to go after Syrian President Bashar al-Assad, who is publically backed by Russia. When Trump made his intentions clear to retaliate against the Assad regime, Russia declared it would shoot down any missiles aimed at Syria. Trump responded this morning by telling Russia to “get ready” and that a U.S. counterattack in Syria was likely. European air control has issued strong warnings swaying pilots from flying over the Mediterranean area for the next 72 hours. Developments on this are still ongoing and investors will continue to monitor for more info, but early effects can be seen as the Ruble and Dollar slightly trade lower.

In other big news, Facebook CEO and founder Mark Zuckerberg took center stage in D.C. as he testified before a Senate committee. Facebook shares saw a decent boost from this yesterday but have begun trading lower today. Zuckerberg is set to testify before the House committee today to finish off his two-day testimony regarding the Cambridge Analytica data scandal. The Facebook founder took questions from Senators on everything from privacy concerns to the idea that Facebook has become a monopoly on data and in its industry.  Zuckerberg struggled to define the company as either a neutral forum or a publisher, which would mean it is responsible for its content, but assured Senate members that Facebook will take the appropriate measures to prevent another scandal like this and furthermore, to prevent foreign interests from interfering or affecting elections, both in the U.S. and worldwide. Today’s testimony will be in front of the House Committee on Energy and Commerce and should see a continuation of yesterday’s line of questioning regarding Facebook business model and security measures. For the year Facebook is down 6.5%.

At the time of publication, the DJIA is down 0.22%, or 53.36 points, at 24,280.67. The S&P 500 is at 2,648.48- up 0.03% from the open. The Nasdaq-100 is up 0.34% at 7,082.23.  

Using the ^GSPC symbol to analyze the S&P 500, our 10-day prediction window shows solid positive signals. Today’s vector figure of 0.90% moves to +1.10% in one trading session. Today’s predicted support and resistance levels are 2,642.79 (±11.22) and 2,698.58 (± 11.46), respectively. The predicted close today is 2,693.27. 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 April 9, our ActiveTrader service produced a bullish recommendation for Nasdaq, Inc. (NDAQ). ActiveTrader is included in all paid Tradespoon membership plans and is designed for intraday trading.

Trade Breakdown

NDAQ opened within Entry 1 price range of $85.20 (± 0.32) and moved through its Target price of $86.05 within the first hour of trading. The Stop Loss was set at $84.35.

Live Trading Room Update

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Buy, Buy, Buy: Stock Signals for Thursday

Our featured stock for Thursday is Apple Inc. (AAPL). AAPL is showing a predicted near-term uptrend 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. Our 10-day prediction model shows vector figure of +1.51% today that remains positive throughout the forecast. Our benchmark for vector figures is +1.00%.

*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 $173.14 at the time of publication, down 0.06% from the open with a +1.51% vector figure.

Thursday’s prediction shows an open price of 176.30, a low of $173.61 and a high of $176.37.

The predicted close for Thursday is $175.98. Vector figures stay at +1.51% on Thursday. This is a good signal for trading opportunities because we use vectors as 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.

Oil

For the third day in a row, oil futures are trading higher. Middle East tensions have the commodity traders concerned over supply and disruption in the area. A weekly report showed a larger than anticipated rise in domestic crude supplies. West Texas Intermediate for May delivery (CLK8) is priced at $66.89 per barrel at the time of publication, up 2.06% from the open.

Looking at USO, a crude oil tracker, our 10-day prediction model shows mostly negative signals. The fund is trading at $13.45 at the time of publication, up 1.51% from the open. Today’s prediction sees support at $12.90 (± 0.08) and resistance at $13.42 (± 0.08). The predicted close for today is $13.41. Vector figures show +0.81% today, which move to -2.23% 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.  

Gold

The price for April gold (GCM8) is up 1.23% at $1,356.50 at the time of publication. As stocks trade lower from geopolitical concerns regarding the U.S., Syria, and Russia, gold continues to act as a safe haven an extends its weekly rally. As the dollar trades lower today, gold looks to have its highest close since August 2016.

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 $128.84, up 1.35% at the time of publication. Today’s predicted low is $126.88 (± 0.35) and the predicted high is $127.61 (± 0.35). The predicted close today is $126.92. Vector signals show +0.08% for today, but turn negative in the latter half of the 10-day outlook. 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

Treasury yields pulled back today while prices rose. Investors will continue to focus on U.S. and China relations while also monitoring the recent developments in Syria. A March consumer report along with minutes from the central bank monetary policy meeting are due today and will further inform investors on the strength of bonds. The yield on the 2-year Treasury is holding steady at 2.31% while the yield on the 10-year Treasury note is down 0.49% at 2.78% at the time of publication. The yield on the 30-year Treasury note is up 0.54% at 3.00% 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 consistent mixed signals in our 10-day prediction window. Today’s vector of +0.07% moves to -0.28% inn four trading sessions. The ETF is priced at $121.37 at the time of publication, up 0.24%. The predicted close today is $120.72 with a low and high of $120.56 (± 0.25) and $122.40 (± 0.25), 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.

Volatility

The CBOE Volatility Index (^VIX) is down 1.76% at 20.11 at the time of publication, and our 10-day prediction window shows all negative signals. The predicted close is 19.86 with a vector of -3.81%. The predicted lows and highs are 19.26 (± 0.75) and 20.52 (± .80), 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.