After Wild Weekend, Major Indices Trade Higher and Return Focus to Earnings

On Friday, what felt like the first quiet trading day, ending a tumultuous week that saw geopolitical tensions with both China and Syria stirred up along with further domestic drama, markets were pulled in both directions, saving the biggest blow for last. Hours after markets closed, the U.S. joined forces with Britain and France to execute a missile strike on Syria, taking aim at facilities responsible for and retaliating to the chemical-weapon attacks held by the President Bashar al-Assad the week prior. While most of Assad’s military facilities appear to remain intact President Trump declared “Mission Accomplished” which caused some geopolitical unease or confusion, however, markets have responded positively. Fear of further escalation after this weekend can be put on hold and therefore markets turn their focus back to earnings.

This week we’ll see earnings from GE and Netflix, both looking to report good growth but investors will continue to monitor for exact numbers. After a choppy 2017 for Netflix, its year-to-date has seen the stock trading higher and looks to report earnings in line with analysts’ predicted average of 65 cents a share.

On Friday, quarterly profits from JPMorgan Chase, Wells Fargo, and Citigroup were released which all exceed expectations but were met with mixed reception, seeing share prices drop between 2% and 3%. In particular, mild growth from fourth to first quarter has analysts hesitant, as some wonder why the big tax cuts haven’t been more impactful on banks.

Besides earnings, this week will also feature a retail sales report released today along with housing starts and industrial production numbers on Tuesday. Fed Reserve Bank Presidents from Chicago, Atlanta, Philadelphia, and San Francisco are scheduled to speak throughout the week, providing investors with plenty of things to watch. In other news, Facebook, after CEO Mark Zuckerberg’s two-day testimony in D.C. regarding the Cambridge Analytica data scandal, has announced it is leaving the information tech sector in September when the S&P debuts its new communications sector, comprised of telecom, tech and consumer directory sectors.This could produce positive results for both the tech sector and the S&P 500 as tech currently holds nearly 25% of the index but investors will continue to monitor for further details.

Although plenty of headline news proved volatile for markets last week, all three major indices ended the week with gains, ranging from 1.8% to 2.8%. At the time of publication, all eleven primary S&P sectors are trading higher, bringing the S&P 500 to 2,6740.80 up .61% from the open. The DJIA is up 0.79%, or 189.13. points, at 24,566.90. The Nasdaq-100 is up 0.46% at 7,145.19.  

Using the ^GSPC symbol to analyze the S&P 500, our 10-day prediction window shows solid positive signals. Today’s vector figure of 0.30% moves to +1.50% in two trading sessions. Today’s predicted support and resistance levels are 2,673.05 (±8.63) and 2,685.58 (± 8.67), respectively. The predicted close today is 2,684.99. 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.

Highlight of a Recent Winning Trade

On April 12, our ActiveTrader service produced a bullish recommendation for E*TRADE Financial Corporation. (ETFC). ActiveTrader, included in all paid Tradespoon membership plans, is designed for intraday trading.

Trade Breakdown

ETFC opened within Entry 1 price range of $57.08 (± 0.39) at $57.48 and moved through its Target price of $57.65 to $58.00 within the first hour of trading. The Stop Loss was set at $56.51.

Live Trading Room Update

When the market was down last week, see how we traded in volatile conditions and what you might expect in our next Live Trading Room. During recent volatility, we held Live Trading Room Session where our winning trades ranged 4.17% to over 67.47% ROI!

Our Live Trading Room is open every trading day from 9:15 am Eastern Time, but these Live Trading Sessions are only available for Premium Members.

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Buy, Buy, Buy: Stock Signals for Tuesday

Our featured stock for Tuesday is ConocoPhillips (COP). COP is showing a predicted near-term uptrend 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. Our 10-day prediction model shows vector figure of +0.94% today that remains positive throughout the forecast. Our benchmark for vector figures is +1.00%.

*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 ActiveInvestor recommendations. If you are interested in receiving Vlad’s personal picks, please click here.

The stock is trading at $67.37 at the time of publication, up 0.72% from the open, with a +0.94% vector figure.

Tuesday’s prediction shows an open price of 65.60, a low of $64.84 and a high of $66.02

The predicted close for Tuesday is $65.30. Vector figures rise to +1.62% on Tuesday. This is a good signal for trading opportunities because we use vectors as a primary factor in determining price movements for stocks and ETF.

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 next trading session relatively to average of actual prices for last trading session. The column shows expected average price movement “Up or Down”, in percent. Trend traders should trade along predicted direction of the Vector. The higher the value of the Vector the higher its momentum.

Oil

After a strong week for oil prices, the commodity is trading lower today. Syrian tension last week proved positive for oil prices but after some de-escalation this weekend, along with the International Energy Agency indicating global oil stockpiles are diminishing, the commodity looks took a small hit to start the week. China and U.S. tensions are also on investors’ minds as further friction could prove volatile. West Texas Intermediate for May delivery (CLK8) is priced at $66.42 per barrel at the time of publication, down 1.38% from the open.

Looking at USO, a crude oil tracker, our 10-day prediction model shows mostly negative signals. The fund is trading at $13.40 at the time of publication, down 1.11% from the open. Today’s prediction sees support at $13.39 (± 0.07) and resistance at $13.55 (± 0.07). The predicted close for today is $13.41. Vector figures show -0.62% today, which move to -2.58% in three 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.  

Gold

The price for June gold (GCM8) is up +0.29% at $1,349.70 at the time of publication. Gold prices rose on Monday after some early morning geopolitical action and reactions from the busy weekend. This morning, President Trump tweeted that both Russia and China are “playing the Currency Devaluation game” against the U.S., which in turn put some pressure on the dollar but proved positive for the commodity. However, rather than outright powering the safe-haven metal, positive gains by assets have dulled gold gains.

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 $127.8962, up +0.35% at the time of publication. Today’s predicted low is $126.79 (± 0.35) and the predicted high is $128.01 (± 0.35). The predicted close today is $127.15. Vector signals show +0.02% for today, but turn negative in the latter half of the 10-day outlook. 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.  

Treasuries

Treasury yields rose today while prices pulled back as worries over further Syrian interaction begin to fade. With both Iran and Russia, Syria’s allies, stating their intention to avoid retaliation for the attempted intervention on America’s part, yields prices saw a small boost. The yield on the 2-year Treasury is up +0.53% at 2.36% while the yield on the 10-year Treasury note is up +0.29% at 2.83% at the time of publication. The yield on the 30-year Treasury note is up 0.11% at 3.03% at the time of publication. The spread between the two and ten year Treasuries are declining.

Using the iShares 20+ Year Treasury Bond ETF (TLT) as a proxy for bond prices in our Stock Forecast Tool, we see consistent negative signals in our 10-day prediction window. Today’s vector of -0.11% moves to -0.51% inn three trading sessions. The ETF is priced at $120.801 at the time of publication, down 0.08%. The predicted close today is $120.06 with a low and high of $119.99 (± 0.26) and $121.54 (± 0.26), respectively. Prediction data is uploaded after markets close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.

Volatility

The CBOE Volatility Index (^VIX) is down 3.85% at 16.74 at the time of publication, and our 10-day prediction window shows all negative signals. The predicted close for today is 16.86 with a vector of -0.36%. The predicted lows and highs are 16.63 (± 0.58) and 18.08 (± .63), respectively. 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.