U.S. stock futures are set to open higher to start the week after the Federal Reserve took historic steps to support U.S. households. The Fed announced they would now lend against student loans and credit card loans, and they will become a buyer of larger companies’ bonds. S&P 500 futures popped up over 3% on the news after being limit down overnight. Investors will now be looking to Washington for the proposed $1 trillion stimulus package to be passed, possibly, later this week.
The S&P 500 closed at a new low for the year at 2304.92 and is just above critical support at 2280.52. The selling on Friday came with a massive volume of 5.3 billion shares. So, potential resistance could come in at 2478.86 if buyers should come into markets. The RSI index continues to be divergent post higher lows while the index posts new lows. We are encouraged to see the selling power lowered, and we are hopeful that a short-term bottom is possibly in place.
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.