Markets unfazed and eeking up as government shutdown continues

Although lawmakers were unable to strike an agreement which resulted in a partial government shutdown over the weekend, market activity is little affected. Short-term sentiments and uncertainties may be impacted but there are no significant risks associated with shutdowns, and all major indices are currently up. It is possible that economic data reports could be delayed throughout the week due to government employees being placed on furlough.

On the earnings front- Halliburton Co. (HAL) reported better than expected results and shares are up 4.94% at the time of publication. Due to report after markets close today is Netflix Inc. (NFLX), and shares are already up 2.44% at the time of publication.

At the time of publication, the DJIA is up 0.04%, or 9.00 points, at 26,081.32. The S&P 500 is trading at 2,818.67- up 0.30% from the open. The Nasdaq-100 is up 0.51% at 7,373.58.  

Using the ^GSPC symbol to analyze the S&P 500, our 10-day prediction window shows  consistent positive signals. Today’s positive vector figure of +0.37% moves to +0.68% within three trading sessions.  Today’s predicted support and resistance is 2,815.38 (± 4.04) and 2,833.68 (± 4.07), respectively. The predicted close today is 2,830.43. 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 January 19, our ActiveTrader service- which is included in all paid Tradespoon membership plans- generated a trade recommendation for Seagate Technology PLC (STX). Our ActiveTrader service is designed for intraday trading.

Trade Breakdown

STX moved within the Entry 1 ($52.01, ± 0.36) and Entry 2 ($51.75, ± 0.36) price ranges in the first hour of trading, moving to hit our Target Price of $52.53 in the third hour of the session. The Stop Loss was set at $51.49.

Buy, Buy, Buy: Stock Signals for Tuesday

Our featured stock for Tuesday is Adobe Systems Incorporated (ADBE). ADBE is showing solid bullish signals in our Stock Forecast Toolbox’s 10-day forecast. This stock is assigned a Model Grade of (A)– indicating it ranks in the top 10th percentile for accuracy for predicted support and resistance, relative to our entire data universe. Our 10-day prediction model shows vector figures holding above +1.00% 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 $197.21 at the time of publication, up 0.76% from the open with a +1.01% vector figure.

Tuesday’s prediction shows an open price of $198.47, a low of $195.68 and a high of $198.67.

The predicted close for Tuesday is $197.00. Vector figures rise to +1.18% in four trading sessions and build throughout the forecast.  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.

Crude oil prices are gaining today after an announcement from Saudi Arabia, the leading OPEC member-country, which signaled production cuts could be extended past 2018. The majority of participants in the OPEC accord, including non-member country Russia, indicated they will coordinate slashes in output beyond the timeframe currently outlined. On the other side of the global output coin is the U.S., Canada and Brazil, who are not members of OPEC and are not bound by the terms of the agreement. The U.S. is typically seen as the leader in responding to higher crude prices with increased production activity. As prices rise even higher to relative peaks, other non-OPEC countries producing oil will follow that pattern.

West Texas Intermediate for February delivery (CLG8) is priced at $64.02 per barrel at the time of publication, up 0.38% from the open.  

Looking at USO, a crude oil tracker, our 10-day prediction model shows solid positive signals. The fund is trading at $12.69 at the time of publication, down 0.24% from the open. Today’s prediction sees support at $12.58 (± 0.04) and resistance at $12.78 (± 0.04). The predicted close for today is $12.74. Vector figures show +0.12% today, pushing to +0.28% 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 February gold (GCG8) is down 0.10% at $1,334.00 a troy ounce at the time of publication. The safe-haven metal is defying some expectations during a government shutdown and moving lower today, following high volatility in the past week. Investors are anticipating the results of an European Central Bank meeting on January 25 for clues around monetary policy- which is expected to become more hawkish. These policy decisions would have direct impacts on the U.S. dollar performance- the currency in which gold is denominated in. The non-fiat metal may still be due for an upward correction depending on how the week plays out politically, which may ramp up risk-averse attitudes.

Using SPDR GOLD TRUST (GLD) as a tracker in our Stock Forecast Tool, the 10-day prediction window shows mixed signals without strong convictions- indicating slight sideways movement. The gold proxy is trading at $126.35, down 0.06% at the time of publication. Today’s predicted low is $126.16 (± 0.24) and the predicted high is $126.82 (± 0.24). The predicted close today is $126.73. 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

The Treasuries sell-off run is abating today as investors turn to wait-and-see mode during the government shutdown process. The shutdown does not have immediate significant impacts on the markets or the economy, but it may delay key economic data reports which inform the treasuries markets. What is in focus, instead, are the two upcoming meetings this week for the Bank of Japan and the European Central Bank. After a long period of loose monetary policy, most are expecting both central banks to move to a more hawkish, tighter set of policies as global economic performance has improved.  The yield on the 10-year Treasury note is down 0.35% at 2.64% 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 an initial negative signal moving to strong positive trends in our 10-day prediction window. Today’s vector of -0.40% moves to +2.31% in three trading sessions.  The ETF is priced at $123.43 at the time of publication, up 0.30%. The predicted close today is $122.37 with a low and high of $121.93 (± 0.39) and $123.65 (± 0.40), 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.

Cryptocurrencies

Last week’s crypto sell off is seeing an expected recovery today as the top 3 (Bitcoin, Ethereum and Ripple) regain relative normalcy. The spike in fear around regulatory crackdown initiatives worldwide served as a stress test for the burgeoning new technology platforms, and we can expect to see more minor jitters with future events like these.

The spot price for a single bitcoin (BTCUSD) is down 6.74% at $10,583.00 at the time of publication. The spot price has climbed above $12,000 over the weekend and hit a ceiling at $13,000.  CME’s January futures contract for bitcoin (BTCF8) is down 7.04% at $10,560.00 at the time of publication.

Ether coins on the Ethereum blockchain still hold the No.2 spot in terms of valuation and market cap. The spot price for an Ether coin is down 4.62% from 24 hours at $995.05 at the time of publication.

The spot price of a single Ripple coin- which ranks No. 3 with a market cap of over $48B- is down 9.56% from 24 hours at $1.24 at the time of publication.

Using Grayscale’s Bitcoin Investment Trust (GBTC) as a Bitcoin tracker in our Stock Forecast Toolbox, we see overall mixed signals in our 10-day prediction window. Today’s vector of +1.77% holds positive for the first half of the forecast before showing a block of negative signals in the latter half. The proxy trust is priced at $1,713.30 at the time of publication, down 3.10% or $54.73. The predicted close today is $1,875.96 with a low and high of $1,768.03 (± 98.26) and $1,955.79 (± 108.70), respectively. Consider that this forecast is using market data from the close on Friday, so activity over the weekend has not been digested yet.  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.

Volatility

The CBOE Volatility Index (VIX) is down 3.38% from the open at 10.90 at the time of publication, and our 10-day prediction window shows continued low levels. Although the government shutdown sheds light again on high bipartisan tensions, markets and the economy do not see big impacts in the short-term. The predicted close today is 11.65 with a negative vector of -0.48%.  Today’s predicted lows and highs are 10.99 (± 0.23) and 11.70 (± 0.24), 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.