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Markets are trading lower today as uncertainty regarding U.S.-China tariff relief and rising Hong Kong tensions weaken global trade optimism. Along with bond markets, which are closed in observance of the Veterans’ Day holiday, there will be no key economic or earnings reports released today; however, big-name earnings still due this week will feature Cisco, Viacom, Walmart, Tilray, and Tyson Foods. Several key Fed officials will be giving speeches this week, including Vice Chairman Richard Clarida on Tuesday, Fed Chair Jerome Powell on Wednesday, and President of the New York Fed John Williams on Thursday. With the latest U.S.-China progress regarding “phase one” of the trade deal as well as the better than expected Q3 earnings data, we will look to buy when the SPY is near $297. Overhead resistance sits near $310 for the SPY and there is little evidence the market will retest its 200 days MA, having just recently broken through 52 weeks high. We expect shallow pullbacks, as well as further volatility, and encourage readers to maintain clearly defined stop levels for all positions. For reference, the SPY Seasonal Chart is shown below:
Stocks lowered in early morning trading following the latest U.S.-China development. President Trump’s recent comments indicated a smaller group of tariffs that will be rolled back as part of the “phase one” trade deal between the U.S. and China. With the constant back and forth between in the world’s two biggest economies, markets both domestically and globally continue to be affected. Although all three major U.S. indices were initially on track to close in the red today, the Dow was able to rebound and currently on track to close with slight gains. Markets last week were able to rise off the continued positive economic data received both from corporate earnings and federal economic reports. With most Q3 earnings out, the latest earnings season featured mostly better-than-expected results which helped support markets. This week will feature key earnings data from Walmart, Tyson Foods, Tilray, Cisco, Viacom, and Nvidia. Other key reports set to release this week include October Core CPI, Federal Budget, Retail Sales, Q3 Household Debt, and September Business Inventories.
Rising tension in the Middle East continues to factor into oil prices as the latest oil data showed a significant increase in demand last week while forecast demand continues to increase. Over in Europe., Prime Minister Boris Johnson is on the campaign trail ahead of the newly extended Brexit deadline while Spain’s election over the weekend did not resolve the country’s recent political deadlock. In Hong Kong, tensions between protestors and police have resulted in further violence and continue to weigh on Chinese markets. With this in mind, Asian markets closed in the red while European markets closed to mixed results, though most markets were in the red.
Using the “^GSPC” symbol to analyze the S&P 500 our 10-day prediction window shows positive signals. Today’s vector figure of -0.02% moves to +1.10% in five 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 October 31st, our ActiveTrader service produced a bullish recommendation for Illinois Tool Works Inc. (ITW). ActiveTrader is included in all paid Tradespoon membership plans and is designed for day trading. Signals are meant to last for 1-2 days as long as vector confirms the same direction as the original pick
Trade Breakdown
ITW entered its forecasted Strategy B Entry 1 price range $170.21 (± 1.03) in its first hour of trading the following trading day (11/1/19) and passed through its Target price of $171.91 in the first hour of trading the next day (11/2/19). The Stop Loss price was set at $168.51.
*Please note: At the time of publication we do not own the featured symbol, CAT. 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 Caterpillar Inc. (CAT). CAT 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 $147.76 at the time of publication, down 0.27% from the open with a +0.54% 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 $56.93 per barrel, down 0.54% 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 $11.91 at the time of publication, down 0.67% from the open. Vector figures show +0.12% today, which turns -2.01% 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.
The price for the Gold Continuous Contract (GC00) is down 0.36% at $1,457.60 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 $137.19, down 0.15% at the time of publication. Vector signals show +0.24% 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 CBOE Volatility Index (^VIX) is down 0.71% at $12.53 at the time of publication, and our 10-day prediction window shows mostly positive signals. The predicted close for tomorrow is $12.77 with a vector of +3.28%. 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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