All three major U.S. indices are in the red today behind continued U.S.-China trade uncertainty as well as the recent tariffs and tech bans. Preeminent tech and communication companies such as Google, Microsoft, and Intel continue to trade lower following the Huawei ban while European and Asian markets are also suffering, with both closing significantly lower. Today’s corporate earnings are led by Best Buy, HP, and Nintendo while next week’s earnings load tapers off with only a handful of notable names. These include Costco, Dell Technologies, Dollar Tree, and Lululemon. We expect the market to continue trading between $280-$294 for the SPY, with the ETF currently trading below its 50-days moving average. We encourage our readers to avoid chasing the market near $290 but consider buying near $280. However, if the market breaks its $290 resistance, we expect the market to rally to $300 in the next 30-60 days. For reference, the SPY Seasonal Chart is shown below:
The Dow, S&P, and Nasdaq are all on track to close with over 1% losses which can mainly be attributed to recent tariff back and forth between the U.S. as well as tech bans that followed. China, in recent days, has hardened their stance and rhetoric towards the U.S. while U.S. investors are starting to factor in and expect continued trade war effects. Global markets are also being affected by the two nations recent trade turmoil, with several U.K. companies looking to make adjustments and/or halt production while the Huawei situation gets sorted. U.K. chip maker Arm Holdings, for example, are pausing business production with Huawei. Companies in Japan are also considering similar protective actions. Recent European manufacturing data could also be contributing to the selloffs as recent data continues to underwhelm. Look for U.S. manufacturing data today, while next week we will see U.S. consumer sentiment, core inflation, and GDP revision.
As previously stated, U.S. corporate earnings will slow down next week with only a few notable names: Costco, Dell Tech, The Gap. Monday, markets will be closed in the U.S. due to Memorial Day observance. Best Buy reported before the market opened today with earnings that topped forecasts but had a downbeat outlook for the rest of 2019, causing shares to lower over 6% today. Yesterday L Brands, parent company to Victoria’s Secret and Bath & Body Works, released better than expected first quarter earnings which are helping shares to over 10% gains today. Look for Hp Inc., Hewlett Packard, Ross Stores, and Autodesk to report after market-close today.
Using the “^GSPC” symbol to analyze the S&P 500, our 10-day prediction window shows mixed signals. Today’s vector figure of +0.27% moves to -0.66% in five trading sessions. The predicted close for tomorrow is 2,926.72. Prediction data is uploaded after the market close at 6 pm, CST. Today’s data is based on market signals from the previous trading session.
On May 15th, our ActiveTrader service produced a bullish recommendation for Whirlpool Corp (WHR). ActiveTrader is included in all paid Tradespoon membership plans and is designed for day trading.
WHR entered its forecasted Strategy A Entry 1 price range $129.06 (± 0.82) in its first hour of trading and passed through its Target price $130.35 in the second hour of trading that day. The Stop Loss price was set at $127.77.
*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 MonthlyTrader recommendations. If you are interested in receiving Vlad’s personal picks, please click here.
Our featured symbol for Friday is The Southern Company (SO). SO 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 $54.12 at the time of publication, with a +0.23% 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 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 $57.77 per barrel, down 5.94% from the open, at the time of publication.
Looking at USO, a crude oil tracker, our 10-day prediction model shows positive signals. The fund is trading at $12.01 at the time of publication, down 6.00% from the open. Vector figures show +0.12% today, which turns +2.98% 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.
The price for the Gold Continuous Contract (GC00) is up 0.79% at $1,284.30 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 $121.34, up 1.00% at the time of publication. Vector signals show -0.03% 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.
The yield on the 10-year Treasury note is down 3.29% at 2.31% at the time of publication. The yield on the 30-year Treasury note is down 2.40% at 2.74% 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 negative signals in our 10-day prediction window. Today’s vector of -0.04% moves to -0.19% 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.
The CBOE Volatility Index (^VIX) is up 17.35% at $17.35 at the time of publication, and our 10-day prediction window shows negative signals. The predicted close for tomorrow is $13.71 with a vector of -7.50%. 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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