Wall Street is set to open higher after the biggest down day since the fall of 1987 and in the process wiped out all the gains for 2019. In overnight trading, the S&P 500 futures hit their upside limits, triggering a halt to trading, but the gains were short-lived as sellers came in and brought futures lower. Investors are now concerned that the real economic impact of the coronavirus is still unknown, and how the impact could impact global stock markets.
The S&P 500 moved below support at 2478.86 and closed at a new low for the year at 2386.13. Potential new support is now at the 12/28/2018 low of 2346.58. Volume was once again heavy on Monday, and the RSI index moved lower in support of the selling to close at 30.17 level. Since the S&P 500 made a new low, we must continue to be cautious to protect against any further selling, and more importantly, guard against the important potential support level of 2346.58 not holding.
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.