U.S. stock futures are set to open much lower to start the week after a selloff in oil and the continued fear of the coronavirus. Oil prices were off by a third as Saudi Arabia and Russia announced a hike in output on Monday. At one point, stock futures were off by 5% in early morning trading, and the Dow was set to open 1,300 points lower to start the day. Investors will now be facing the possibility of panic setting into world markets.
The S&P 500 moved below support at 2976.63, traded as low as 2901.54, and closed at 2976.63 on Friday. The RSI index also moved lower to close at 35.62, and volume was above average. Although the late-day rally was impressive, the index did close below support, which could bring in more selling this week. Potential support could now come in at 2855.84at the low for the year set on 2/28/2020. If that level does not hold, the next possible support could become 2822.12.
We are currently long-term bullish and short-term bearish.
John N. Lilly III
Accredited Portfolio Management Advisor℠
Accredited Asset Management Specialist℠
Portfolio Manager, RJ
Dominguez & Jones Wealth Management Group
The Relative Strength Index (RSI), developed by J. Welles Wilder, is a momentum oscillator that measures the speed and changes of price movements.
The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the U.S stock market. Past performance may not be indicative of future results. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investors’ results will vary. Opinions expressed are those of the author John N. Lilly III, and not necessarily those of Raymond James. “There is no guarantee that these statements, opinions or forecast provided herein will prove to be correct. “The information contained was received from sources believed to be reliable, but accuracy is not guaranteed. Investing always involves risk and you may incur a profit or loss. No investment strategy can guarantee success. The charts and/or tables presented herein are for illustrative purposes only and should not be considered as the sole basis for your investment decision. International investing involves special risks, including currency fluctuations, different financial accounting standards, and possible political and economic volatility. Investing in emerging markets can be riskier than investing in well-established foreign markets.