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U.S. stocks continued to trade lower on Wednesday, extending the slump as the Dow books its fifth straight losing session. The Nasdaq and S&P snapped losing streaks on Tuesday with minor gains but returned to trade lower on Wednesday. Inflation and the latest economic reports continue to inform market direction as investor focus turns from earnings to key inflation indicators. The latest Consumer Price Index showed the U.S. economy continued to struggle with inflation in April as the rate slowed far less than anticipated. Oil futures and the energy sector rose today while cryptocurrencies took a major hit. Earnings have significantly slowed down with today’s only major release being Walt Disney after the close while tomorrow look out for Alibaba and Aurora Cannabis. Next week, several key retailers release quarterly earnings reports, including Walmart, Home Depot, Lowe’s, and Target. Also look out for April’s Retail Sales, Housing Starts, and Industrial Production next week.
The volatility index ($VIX) is at a 35 level. The market’s next move may be affected by geopolitical risks in Ukraine, the CPI and PPI statistics, and other factors. We’re keeping an eye on the SPY’s overhead resistance levels, which are presently at $410 and then $430. The $SPY support is at $395 and then $380. We expect the market to continue the pattern of lower highs and lower lows for the next 2-6 weeks. In the short term, the market is oversold. All eyes remain on the VIX. Globally, both European and Asian markets closed in the green. We encourage all market commentary readers to maintain clearly defined stop levels for all positions. For reference, the SPY Seasonal Chart is shown below:
The symbol is trading at $16.07 with a vector of -0.41% at the time of publication.
10-Day 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.
*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 $105.59 per barrel, up 5.84%, 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 $78.18 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 0.61% at $1852.20 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 $172.82 at the time of publication. Vector signals show +0.39% 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 3.001% at the time of publication.
The yield on the 30-year Treasury note is down, at 3.047% 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 $32.56 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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