Oil & energy stocks soar and push Dow toward 20,000. Trump dents Lockheed’s stock with critical tweet.

The Dow Jones Industrial Average is continuing to make climbs toward the 20,000 mark. The index is currently trading at 19,768.14, up 28.29 points, or 0.14%. Oil and energy is driving this new surge, following agreements between OPEC and Non-OPEC countries to limit output. The Nasdaq-100 is down 0.72% today at  5406.02, many analysts attribute this to a drop in FANG stocks.  The S&P 500 is another beneficiary from these surges, and is now releasing some steam after pushing past 2,600 this morning. Currently, the index is down 3.72, or 0.16% at 2255.81.

Using the ^GSPC symbol to analyze the S&P 500, our prediction model shows consistent declines after today’s jump. The predicted close today is 2264.67, with predicted support and resistance at 2245.46 (± 7.13) and 2268.82 (± 7.20), respectively.  

President-elect Donald Trump decided to call out Lockheed Martin for the spiraling costs of its F-35 fighter jet program. More than a typical brash statement, Trump followed up to indicate he will be looking at drawing back future defense spending, and wants a lifelong ban on government procurement personnel entering the private defense-contractor industry.  Consequently, Lockheed’s stock instantly declined today and is struggling to climb back.  LMT is currently trading at $247.99, down 4.45%.

Upcoming Events & Reports

The long-anticipated FOMC meeting is now convening and will conclude tomorrow, December 13. The meeting is widely expected to produce a decision to raise interest rates, albeit by a predicted quarter of a percent. Apart from the rate change of 0.5% to 0.75%,  big questions around the pending Trump administration are expected to be skirted.

Oil

Crude oil futures are rallying, and in turn is fueling a rise in energy stocks following production cut agreement between OPEC and Non-OPEC countries. Russia is pledging to cut production by 300,000 barrels per day. Oil shot to $54.45 in early morning trading, and is now making slight corrections downard. Futures are currently trading at $53.05, up  1.55, or 3.01%.

Looking at USO, a crude oil tracker, our 10-day prediction model shows overall positive movements that dip momentarily between Dec. 15-16. The fund is currently down 3.06% at 11.7901. Today’s prediction sees support at 11.44 (± 0.11) and resistance at 11.67 (± 0.11). The predicted close for today is 11.55.  After the forecasted gains, we show a predicted Dec. 23 close of 12.22, with support and resistance at 11.99 and 12.22.

Gold

Gold is edging back up slightly from a 5-week skid, currently up 0.10% at $1163.10. The non-fiat metal is facing pressure from a number of sources: expected interest rate hikes from the Fed, soaring stock indexes, and the 10-year yield for U.S treasuries has moved to its highest levels since Sep. 2014- above 2.5%

Using SPDR GOLD TRUST (GLD) as a tracker in our Stock Forecast Tool, we see positive vectors ranging between 1-2%. It is currently trading at 110.72 which is up 0.13, or 0.29%. Today’s predicted low is 110.40 (± 0.43) and the predicted high is 111.67 (± 0.44). The predicted close today is 111.14.

Volatility

The CBOE Volatility Index (VIX) is up 6.38% at 12.5 with a consistent positive movement predicted. Our 10-day model shows vector values rising from 3% to over 20%. The predicted close today is 12.79. Today’s predicted lows and highs are 11.75 (± 0.26) and 14.20 (± 0.32), respectively.  Predicted 10-day figures show support contained between ~12 and ~15. Predicted resistance stays between ~14 and ~16.