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Indices are trading up today following a weekend raft of positive corporate merger news and an upbeat tune to trade deal commentary from China and the United States. The S&P 500 rose 0.6% to 3,129 today, above its last closing high of 3,122.03 on 11/18. The Nasdaq also breached its last closing record (11/19) by climbing 98 points to 8,570.66. Hong Kong’s pro-democracy parties swept local district council elections over the weekend as well, but does not appear to be an impediment in progressing trade talks.
A Chinese government report released over the weekend had called for more focus on safeguarding intellectual property rights. Claims of IP-theft by U.S. corporations at the hands of the Chinese government is a centerpiece of the trade negotiation, and a long-standing point of contention. The report had specifically advised:
“… speeding up the introduction of a punitive compensation system for infringements of patents and copyrights, and strengthening the protection of trade secrets, confidential business information and their source codes.”
U.S. national security adviser Robert O’Brien suggested to reporters over the weekend that a phase-one deal is possible by the end of this year. Pro-democracy opposition parties in Hong Kong have made a resounding victory in weekend elections, now commanding 452 district council seats. This is considered a domestic defeat for Beijing and Hong Kong opposition is supported by the U.S.
The recently-announced M&A deal between The Charles Schwab Corp. (SCHW) and TD Ameritrade (AMTD) is finalized as an all-stock deal valued around $26 billion. Both stocks are trading up at the time of publication.
SPY overhead resistance remains $310 and we will look to buy when the SPY is near $297 level. There is little evidence we will retest 200 days MA, and we expect further volatility as well as shallow pullbacks. We encourage Market Commentary readers to maintain clearly defined stop levels for all positions. For reference, the SPY Seasonal Chart is shown below:
Uber Technologies Inc. (UBER) is hitting a snag today in trading after the ride-hailing company lost its license to operate in London. Regulators discovered over 14,000 trips had been taken by uninsured drivers over the past two years. Uber has commented that it will be appealing. London is Uber’s largest market in Europe to date.
Ebay (EBAY) saw its share price jump 1.30% after reports of a near-finished deal with Viagogo in which Ebay will sell off StubHub, its ticketing business to the Swiss ticket reseller. The deal is valued at $4.05 billion in cash. Ebay bought StubHub in 2007 for $310 million.
In upcoming economic news: Federal Reserve Chairman Jerome Powell is set to speak tonight at 7 p.m. Eastern in an address for “building gains on a long expansion.”
Using the “^GSPC” symbol to analyze the S&P 500 our 10-day prediction window shows a near-term negative outlook. Today’s vector figure of -0.08% moves to -0.20% in four trading sessions. Prediction data is uploaded after the market closes at 6 p.m. CST. Today’s data is based on market signals from the previous trading session.
On November 11th, our MonthlyTrader service produced a bullish recommendation for Eli Lilly and Company (LLY). MonthlyTrader is included in Tools, Premium, Elite Trading Circle or available as a standalone subscription. This service provides 3 bullish and 3 bearish stock & single option signals for 2-5 day trades.
Trade Breakdown
LLY entered its forecasted Strategy A Entry 1 price range $112.03 (± 0.70) in its first hour of trading on 11/14 and passed through its Target price of $117.63 in the first hour of trading today- 11/25/19. The Stop Loss price was set at $106.43. Every stock recommendation includes a single option strategy based on the stock price parameters.
*Please note: At the time of publication Vlad Karpel does not have a position in the featured symbol, CI. 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 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 Tuesday is Cigna Corp. (JCI). CI is showing a confident vector trend 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 current-day predicted support and resistance, relative to our entire data universe.
The stock is trading at $204.13 at the time of publication, up 1.45% from the open with a +0.50% vector figure.
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.
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.
West Texas Intermediate for Crude Oil delivery (CL.1) is priced at $57.86 per barrel, up 0.16% from the open, at the time of publication. Positive U.S/China trade deal sentiments and OPEC compliance updates are providing support for oil prices today.
Looking at USO, a crude oil tracker, our 10-day prediction model shows a near-term negative trend. The fund is trading at $12.10 at the time of publication, down 0.08% from the open. Vector figures show -0.90% today, which turns -1.29% in three trading sessions. 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 0.42% at $1,457.40 at the time of publication. Gold prices are giving way to continued optimism for a year-end phase-one China/U.S. trade deal.
Using SPDR GOLD TRUST (GLD) as a tracker in our Stock Forecast Tool, the 10-day prediction window shows mixed, neutral signals. The gold proxy is trading at $137.31, down 0.31% at the time of publication. Vector signals show -0.01% 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 0.87% at 1.76% at the time of publication.
The yield on the 30-year Treasury note is down 0.85% at 2.20% 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 overall positive signals in our 10-day prediction window. Today’s vector of +0.43% moves to +0.63% in three sessions. 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 down 2.43% at $12.04 at the time of publication, and our 10-day prediction window shows strong positive 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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