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Markets are trading lower today behind alarming economic reports and continued impeachment concerns. Yesterday’s factory index release showed manufacturing activity slipped for the fifth straight month while private-sector jobs also lowered. With additional details still being released and congressional testimonies scheduled for the weeks ahead, the latest impeachment news involves Secretary of State Mike Pompeo’s involvement in the call with the Ukrainian President in question. Globally, markets in Asia and Europe closed in the red; China-U.S. negotiations are set to resume next week while over in Europe the World Trade Organization ruled in favor of the U.S. to expand tariffs against the European Union. With the SPY is trading between $282-294, we believe the market is range-bound and we do not see the potential for the market to overshoot an all-time high of $302. Short-term support is at $282 and we will look to buy when SPY is near $282, sell near $294. Further volatility is expected and we encourage readers of Market Commentary to maintain clearly defined stop levels for all positions. For reference, the SPY Seasonal Chart is shown below:
All three major U.S. indices are on track to close in the red today with near 2% losses behind fears of slowing economy and continued impeachment concerns. The latest manufacturing data showed a slowdown in activity for the fifth straight month while private-sector employment report was also down for September. The private-sector added 135,000 jobs last month but missed expectations, bringing quarterly and annual averages down. Crude oil inventories were up for the third straight week, according to the U.S Energy Information Administration, while oil futures remain lower today amid Middle East tension. Next week, look out for consumer credit, core CPI, and job openings report as well as the FOMC minutes.
President Trump’s impeachment bid continues to dominate headlines with the latest development coming in the form of the Secretary of State Mike Pompeo’s involvement. The call-in question, which triggered the formal impeachment bid, featured the President of Ukraine and Trump but also several White House members, including Pompeo. Today, Trump met with reports while hosting the Finnish President and was questioned on the call heavily. Other news today include the World Trade Organization ruling in favor of the U.S., which would allow the U.S. to levy additional tariffs on the E.U., as well as the upcoming U.S.-China negotiations set to resume next week.
Using the “^GSPC” symbol to analyze the S&P 500 our 10-day prediction window shows negative signals. Today’s vector figure of -0.80% moves to -1.14% in five trading sessions. Prediction data is uploaded after the market close at 6 p.m. CST. Today’s data is based on market signals from the previous trading session.
On September 27th, our ActiveTrader service produced a bullish recommendation for Nike Inc (NKE). ActiveTrader is included in all paid Tradespoon membership plans and is designed for day trading.
Trade Breakdown
NKE entered its forecasted Strategy B Entry 1 price range $92.17 (± 0.50) in its first hour of trading and passed through its Target price $93.09 in the first hour of trading the following trading day. The Stop Loss price was set at $91.25.
*Please note: At the time of publication we do own the featured symbol, VXX. 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 Thursday is iPath S&P 500 VIX Short-Term(VXX). VXX is showing a confident vector trend in our Stock Forecast Toolbox’s 10-day forecast. This stock is assigned a Model Grade of (C) indicating it ranks in the top 50th percentile for accuracy for predicted support and resistance, relative to our entire data universe.
The stock is trading at $25.94 at the time of publication, up 4.64% from the open with a +2.69% 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 the 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 $52.65 per barrel, down 1.79% from the open, at the time of publication.
Looking at USO, a crude oil tracker, our 10-day prediction model shows mixed signals. The fund is trading at $10.96 at the time of publication, down 2.06% from the open. Vector figures show -0.57% today, which turns -1.08% 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 1.03% at $1,504.30 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 positive signals. The gold proxy is trading at $141.29, up 1.19% at the time of publication. Vector signals show +0.64% 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 2.25% at 1.60% at the time of publication. The yield on the 30-year Treasury note is down 0.08% at 2.09% 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 positive signals in our 10-day prediction window. Today’s vector of +0.05% moves to +1.46% 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 down 2.61% at $22.36 at the time of publication, and our 10-day prediction window shows mixed signals. The predicted close for tomorrow is $17.46 with a vector of +0.85%. 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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