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On Monday, share prices plummeted as investors became concerned about additional Fed action and the possibility of a recession, especially with relatively low trading activity leading up to the holiday season. Last week, investors experienced a wild ride as the market initially reacted positively to signs that inflation was declining, only for stocks to fall sharply after the Federal Reserve’s monetary policy announcement. The central bank’s rate hike of 50 basis points wasn’t as drastic as past increases, yet still caused jitters in the markets. This is because analysts now forecast that interest rates will be higher than initially anticipated to contain inflation and protect against an economic recession – a worry which has become more pressing. Ahead of the holiday week, markets will see several key reports released including building permits and housing starts, consumer confidence index, Q3 GDP, and November PCE data.
This week, analysts are watching how the quarterly earnings reports of $MU, $FDX, and $CCL as well as CPE data will affect the trajectory of the market. We are watching the overhead resistance levels in the SPY, which are presently at $390 and then $402. The $SPY support is at $380 and then $370. At this moment, we anticipate the market will reach and surpass its current lows in the upcoming two to eight weeks. Therefore, it is advised that investors remain bearish about their positions and take necessary measures to protect them from potential losses. Globally, Asian markets closed in the red while European markets finished with varying levels of gains. Market commentary readers should maintain clearly defined stop levels for all positions. For reference, the SPY Seasonal Chart is shown below:
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.
*Please note: At the time of publication Vlad Karpel does have a position in the featured symbol, SH. 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 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 picks, please click here.
West Texas Intermediate for Crude Oil delivery (CL.1) is priced at $75.67 per barrel, up 1.86%, 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 $64.9 at the time of publication. 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 0.19% at $1796.80 at the time of publication.
Using SPDR GOLD TRUST (GLD) as a tracker in our Stock Forecast Tool, the 10-day prediction window shows mixed signals. The gold proxy is trading at $166.79 at the time of publication. Vector signals show -0.02% 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 UP at 3.586% at the time of publication.
The yield on the 30-year Treasury note is UP at 3.634% 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 mixed signals in our 10-day prediction window. 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 $22.42 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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