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On Wednesday, U.S. Stocks rose as traders expressed confidence ahead of the release of consumer price index data. Investors are increasingly optimistic that a crucial inflation report will demonstrate that deflationary pressures remain, thereby driving market prices higher today. Fed officials have recently generated some concerns that the economy could experience further pain, however, this was slightly upended by a speech from the Chairman of the Central Bank on Tuesday which yielded minimal details and left investors hoping for the best ahead of the Consumer Price Index data due on Thursday. Another optimistic factor supporting markets has been the relief in Treasury yields. The 10-year U.S. Treasury note has been experiencing a decrease in yield after last week’s employment report, trading closer to 3.5% today.
Come Friday, the fourth-quarter reporting season will be underway and five major financial firms – JPMorgan Chase (JPM), Bank of America (BAC), Citigroup (C), Wells Fargo (WFC), and BlackRock(BLK) – will take center stage with their Q4 reports. At the midweek point, the $VIX is trading near the $20 level. Additional key earnings this week included $TSM, and $DAL while Thursday’s CPI data will be the marquee report which can influence the next move in the market.
As we keep a close eye on the SPY, it is essential to pay attention to its overhead resistance levels; these are located at $395 and then $402. Furthermore, we must also observe the support level of the stock found at $385 and then again at $375. We believe the market will likely hit new lows in the upcoming weeks, which is why we recommend a bearish outlook and advise our subscribers to protect their investments accordingly. Globally, European markets closed in the green while Asian markets saw mixed results. 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 $77.71 per barrel, up 3.45%, 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 $67.64 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 up 0.17% at $1879.70 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 $171.06 at the time of publication. Vector signals show -0.45% 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 down at 3.539% at the time of publication.
The yield on the 30-year Treasury note is down at 3.659% 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 $22.14 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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