Energy Sector, $3.5 Trillion Budget Bill in the Spotlight

by Vlad Karpel

President Biden’s $3.5 trillion budget key market impactors today

After a mixed start to open the week, major U.S. indices impressively traded higher with the S&P leading at 0.85% gains. Positive economic data and the latest on President Biden’s $3.5 trillion budget are key market impactors today while additional economic clarity will arrive next week during the Federal Reserve Open Market Committee meeting.

Although the latest on COVID has soured some sectors with growing delta rates and extended mandates, the energy sector turned in a stellar performance. The volatility index (VIX) touched the $20 level earlier this week and currently sits near $18.

We recommend watching the critical support levels on the SPY at $445 and $440 as we still expect some short-term correction to continue in the next two weeks. ORCL is one of the few remaining key earnings to be released this week as the latest earnings season winds down. Key economic reports due this week include August data for retail sales, industrial production, and Federal Budget. Following the Fed’s reassurance of transitory inflation, markets saw positive support pushing markets towards the upside.

Earnings and the bond market will continue to dictate market movement as well as response COVID infection rates and Hurricane Ida’s impact. Globally, both Asian European markets closed siginficantly lower. We encourage all market commentary readers to maintain clearly defined stop levels for all positions. For reference, the SPY Seasonal Chart is shown below:

Key U.S. Economic Reports/Events This Week:

  • Import Price Index (August) – Wednesday
  • Industrial Production (August) – Wednesday
  • Capacity Utilization (August) – Wednesday
  • Weekly Jobless Claims (9/11) – Thursday
  • Retail Sales (August) – Thursday
  • Business Inventories (August) – Thursday

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For reference, the S&P 10-Day Forecast is shown below:

Using the “^GSPC” symbol to analyze the S&P 500 our 10-day prediction window shows a near-term mixed outlook. Prediction data uploaded after the market closes at 6 p.m. CST. Today’s data is based on market signals from the previous trading session.


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Thursday Morning Featured Symbol

Our featured symbol for Thursday is McDonald’s Corp (MCD). MCD is showing a steady vector in our Stock Forecast Toolbox’s 10-day forecast.

The stock is trading at $240.98 with a vector of -0.12% at the time of publication.

10-Day Prediction data 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, MCD. Our featured symbol is part of your free subscription service. 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.


Oil

West Texas Intermediate for Crude Oil delivery (CL.1) is priced at $72.67 per barrel, up 0.08% 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 $50.69 at the time of publication. Prediction data uploaded after the market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.


Gold

The price for the Gold Continuous Contract (GC00) is up 0.06% at $1795.80 at the time of publication.

Using SPDR GOLD TRUST (GLD) as a tracker in our Stock Forecast Tool, the 10-day prediction window shows negative signals. The gold proxy is trading at $167.83 at the time of publication. Vector signals show -0.08% for today. Prediction data uploaded after the market close at 6 p.m., CST. Today’s data is based on market signals from the previous trading session.


Treasuries

The yield on the 10-year Treasury note is UP, at 1.301% at the time of publication.

The yield on the 30-year Treasury note is UP, at 1.865% 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 uploaded after the 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 $18.18 at the time of publication, and our 10-day prediction window shows mixed signals. Prediction data 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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