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Major U.S. indices are on track to close in the green after the Federal Open Market Committee announced it would not adjust interest rates, while Fed Chair Jerome Powell signaled to the press following the meeting that the Fed would not look to adjust rates in 2020. Strong employment and consumer data are supporting the decision while inflation level and global trade development will continue to be monitored in relation to future Fed decisions. Consumer Price Index data returned showing a 0.3% increase last month, in line with October’s 0.4% increase; through November, the CPI rose by 2.1%. Tomorrow, look out for November Producer Price Index and Q3 Household net worth. There is little evidence SPY will retest its 200 days MA and SPY short-term overhead resistance is currently near $315-$317 level. We do not see technical data supporting this level being broken in the next two weeks. We will look to buy when the SPY is near $303 level. Continued volatility is expected, as well as shallow pullbacks, and we encourage Market Commentary readers to maintain clearly defined stop levels for all positions. For reference, the SPY Seasonal Chart is shown below:
U.S. stocks are trading higher following today’s FOMC decision which kept benchmark interest rates unchanged, currently in the range of 1.5% to 1.75%. Fed Chair Jerome Powell met with the press following the last FOMC meeting of 2019 and signaled the Fed’s intent to keep rates unchanged in 2020. The Fed believes current rates and levels “support sustained expansion” of the economy. The vote to keep rates unchanged was unanimous, with the next FOMC will take place January 28th-29th.
Consumer Price Index spiked last month but in line with October’s rise. Currently, CPI has risen 2.1% in the last 12 months, rising 0.3% last month. Tomorrow, the Producer Price Index for November will release providing another key inflation indicator. Still, with the strong labor and employment market, the Fed felt confident leaving rates unchanged. Additional global trade development can impact Fed’s future decision with key negotiations taking place with China, as well as additional developments in the U.K., Canada, and Mexico. Several retail earnings are due to release after market close including Lululemon, Nordstrom, and American Eagle Outfitters. Tomorrow look for Oracle, Adobe, Costco, and Broadcom data.
Using the “^GSPC” symbol to analyze the S&P 500 our 10-day prediction window shows a near-term mixed outlook. Today’s vector figure of -0.11% moves to +0.33% in four trading sessions. Prediction data is uploaded after the market closes at 6 p.m. CST. Today’s data is based on market signals from the previous trading session.
On December 3rd, our ActiveTrader service produced a bullish recommendation for Pepsico Inc (PEP). ActiveTrader is included in all paid Tradespoon membership plans and is designed for day trading, with signals meant to last for 1-2 days.
Trade Breakdown
PEP entered its forecasted Strategy B Entry 1 price range $135.88 (± 0.32) in its first hour of trading and passed through its Target price of $137.24 in the second hour of trading the following trading day in the final hour of trading. The Stop Loss price was set at $117.74.
*Please note: At the time of publication Vlad Karpel does not have a position in the featured symbol, SWKS. 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 Skyworks Solutions (SWKS). SWKS is showing a neutral 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 current-day predicted support and resistance, relative to our entire data universe.
The stock is trading at $109.64 at the time of publication, up 5.03% from the open with a +0.88% vector figure.
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.
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.
West Texas Intermediate for Crude Oil delivery (CL.1) is priced at $58.87 per barrel, down 0.64% from the open, at the time of publication.
Looking at USO, a crude oil tracker, our 10-day prediction model shows a near-term mixed trend. The fund is trading at $12.31 at the time of publication, down 0.65% from the open. Vector figures show -0.13% today, which turns +1.39% in three 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.
The price for the Gold Continuous Contract (GC00) is up 0.91% at $1,481.30 at the time of publication.
Using SPDR GOLD TRUST (GLD) as a tracker in our Stock Forecast Tool, the 10-day prediction window shows positive signals. The gold proxy is trading at $139.19, up 0.88% at the time of publication. Vector signals show +0.05% for today. 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.
The yield on the 10-year Treasury note is down 2.41% at 1.79% at the time of publication.
The yield on the 30-year Treasury note is down 1.86% at 2.23% 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 overall negative signals in our 10-day prediction window. Today’s vector of -0.53% moves to -0.99% in three 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.
The CBOE Volatility Index (^VIX) is down 2.74% at $15.25 at the time of publication, and our 10-day prediction window shows mixed signals. 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.
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