Markets Dip Following Tuesday’s Tech-Led Rebound, Key Fed Reserve Members Set To Speak

by Vlad Karpel

Latest top for the SPY is set at $360

After snapping a multi-day losing streak on Tuesday, major U.S. indices returned gains with the S&P and Nasdaq on track for over 1% losses while the Dow trades 0.90% lower. The latest top for the SPY is set at $360 and we believe it could be retested by the end of September or early October.

Powell is due to discuss the overall COVID economic impact and outlook

Fed Chair Jerome Powell met with Congress yesterday and testified on the CARES Act while today Powell is due to discuss the overall COVID economic impact and outlook. Vaccine progress looks to support markets with any positive news while the upcoming U.S. election, only a few weeks away, could also factor into market sentiment. Nike saw impressive gains of over 10% after their earnings topped estimates while Tesla dipped over 9% following lukewarm reception, amongst other concerns, to their “Battery Day” event.

 

General Mills, having also recently released earnings, saw shares edge higher; additional earnings to monitor this week include Costco and CarMax on Thursday. With the SPY having broken through its overhead resistance at $340, short-term traders could consider adding to positions when SPY is near $332. Our models are still projecting the SPY to trade in the range of $318-$360 and we will look to be buyers into any short-term corrections. We continue monitoring the VIX as the market can overshoot support and resistance levels when VIX is trading near $30 level, and 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

  • Fed Chair Powell Congressional Testimony (COVID) – Wednesday
  • Markit Manufacturing PMI (September) – Wednesday
  • Markit Services PMI (September) – Wednesday
  • New Home Sales (August) – Thursday
  • Weekly Jobless Claims (9/19) – Thursday
  • Durable Goods Orders (August) – Friday
  • Core Capital Goods Orders (August) – Friday

Upcoming Earnings

  • GIS – General Mills – Wednesday
  • CTAS – Cintas Corp. – Wednesday
  • COST – Costco – Thursday
  • DRI – Darden Restaurants – Thursday
  • ACN – Accenture – Thursday
  • KMX – CarMax – 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 is 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 Pelton Interactive Inc (PTON). PTON is showing a steady vector in our Stock Forecast Toolbox’s 10-day forecast.

The stock is trading at $98.84 with a vector of -1.26% 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, PTON. 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. 


Oil

West Texas Intermediate for Crude Oil delivery (CL.1) is priced at $39.83 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 $28.11 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.


Gold

The price for the Gold Continuous Contract (GC00) is down 2.07% at $1,868.20 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 $179.34, at the time of publication. Vector signals show +0.14% 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.


Treasuries

The yield on the 10-year Treasury note is down, at 0.669% at the time of publication.

The yield on the 30-year Treasury note is down, at 1.426% 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.


Volatility

The CBOE Volatility Index (^VIX) is $29.15 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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