Will tech stocks’ volatility continue?

July 31, 2017

By Vlad Karpel

A sell-off in the tech sector has dragged on major indexes, but overall we are seeing the close of July bringing the markets to a healthy hovering point. A round of strong earnings reports and an agreeable Fed outlook on the economy were contributing factors, but market participants are now looking at the pace of inflation and how that may or may not impact future interest-rate hikes. Investors are also looking at political gridlock in Washington, increasing concerns over the feasibility of passing pro-growth agenda items this year. Economic data, further tech earnings reports (including Apple on Tuesday), and developments in Washington will be three main areas to focus on for the beginning of August.

The DJIA is currently up 0.42%, or 91 points, at 21,921. The S&P 500 is currently trading at 2,473- down 0.02% from the open. The Nasdaq-100 is down 0.45% at 6,346.

Using the ^GSPC symbol to analyze the S&P 500, our 10-day prediction window shows overall positive signals. Today’s positive vector figure of +0.06% moves to +0.20% within four trading sessions. Today’s predicted support and resistance is 2,463.25 (± 3.20) and 2,476.69 (± 3.22), respectively. The predicted close today is 2,473.32. 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.

Must-buy Stocks for Tuesday

Based on our Stock Forecast Toolbox’s 10-day prediction data, we’ve found 2 great candidates of interest. They are:

Amgen, Inc. (AMGN)

Following a positive Q2 earnings report and a new application for an osteoporosis drug, this biotech company is showing a confident uptrend in our short-term prediction model.

Our 10-day prediction model shows two sessions of positive movement followed by a negative correction. The stock is currently trading at $176.16, up 0.93% from the open with a +0.79% vector figure for today. Tomorrow’s prediction sees support at $173.02 and resistance at $178.03. The predicted close for tomorrow is $176.77. Vector figures show +1.49% for tomorrow before reversing downward in the August 2 session. 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.

Ford Motor Company. (F)

Ford’s recently appointed CEO Jim Hackett is slowly revealing future plans for Ford’s product lineup and global operations. Self-driving vehicles are also on the docket for meeting new growth and revenue targets. It’s worth noting that a weakened U.S. dollar can increase international sales as well. Ford, a family owned business, has a history of reacting well to downtrends in the industry sector and remaining self sufficient during hard times.

Our 10-day prediction model shows consistent positive signals. The stock is currently trading at $11.15, which is down 0.15% from the open- but is showing a +0.67% vector figure for today’s session. Tomorrow’s prediction sees support at $11.28 and resistance at $11.51. The predicted close for tomorrow is $11.51. Vector figures show +2.43% for tomorrow and moves to +3.07% in the next few 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.

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Oil

Oil prices have slipped today as investors are taking advantage of a temporary rally which boosted prices to above $50 per barrel in early trading hours. Violent protests and political upheaval in Venezuela is a driving force here, and the U.S. is now considering more aggressive sanctions on the oil-exporting country. Last week saw commentary from OPEC indicating a continuation of production cuts, drops in U.S crude inventories and a potential drawdown in capital expenditures by U.S oil producers. West Texas Intermediate for September delivery is currently priced at $49.26 per barrel, down 0.68% from the open.

Looking at USO, a crude oil tracker, our 10-day prediction model shows overall negative signals. The fund is currently trading at $10.19, which is up 0.20% from the open. Today’s prediction sees support at $9.90 (± 0.06) and resistance at $10.17 (± 0.06). The predicted close for today is $10.06. Vector figures show -0.57% for today, moving to -2.00% in three 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 August gold is currently down 0.02% at $1,268.10 a troy ounce. Although prices saw slight dip today, a consistently weaker U.S dollar and less-than-expected report on U.S GDP for Q2 will likely firm up support for the end of the month. Market participants are looking at a slower timeline for another Fed interest-rate hike, following last week’s FOMC meeting and weaker technical drivers for inflation.

Using SPDR GOLD TRUST (GLD) as a tracker in our Stock Forecast Tool, the 10-day prediction window shows incrementally building positive signals. The gold proxy is currently trading at $120.54, down 0.12% from the open. Today’s predicted low is $120.12 (± 0.25) and the predicted high is $121.05 (± 0.25). The predicted close today is $120.86. 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 are seeing little changes today, but will likely close out the month of July with overall declines. Less-than-expected GDP growth in the U.S., gridlock in Washington and lowered expectations for rising inflation are contributing factors. Investors are looking at the failed health-care bill as an indicator for the feasibility of passing pro-growth agenda items. The yield on the 10-year Treasury note is currently down 0.08% at 2.29%. Bond prices and yields are typically inversely related to one another.

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 moves from +0.55% to +1.19% in three trading sessions. The ETF is currently priced at $123.87- down 0.02% from the open. The predicted close today is $124.63 with a low and high of $123.88 (± 0.29) and $124.73 (± 0.29), 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.

Volatility

The CBOE Volatility Index (VIX) is currently up 1.94% at 10.49, and our 10-day prediction window shows strong positive signals. The predicted close today is 10.61 with a positive vector of +2.81%. Today’s predicted lows and highs are 10.46 (± 0.19) and 11.49 (± 0.21), 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.