U.S. stock markets are set for a lower open on Wednesday after announced stimulus failed to encourage Wall Street. President Trump called for a $1 trillion stimulus package that includes a $1,000 direct payment to individual Americans. Markets rallied on the news but look set to move lower again today. Fears of financial damage to the U.S. economy and Corporate America have now come back into markets. Boeing Co (BA) fell 17% after the company asked for a $60 million bailout, and FedEx (FDX) was off 4.2% after suspending its 2020 profit outlook.
The S&P 500 traded down near the 12/28/2018 support level of 2346.58, but the index rallied to end the day and closed at 2529.19. The RSI index moved higher to support the buying, and volume was once again above average. We are encouraged by the support level holding upon the first test; however, we think another test could possibly take place this week. If the 2346.58 should happen not to hold more selling could possible by in the cards for the S&P 500.
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.
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