U.S. stock futures are down sharply on fears of a second wave of the coronavirus, and a gloomy forecast for the U.S. economy from the Federal Reserve. Equity markets have been rising rapidly as more economies reopened, but now, investors fear a second wave of the virus could slow down economic growth. The U.S. weekly jobless claims fell to an adjusted 1.542 million down from 1.897 million from last week. However, the number of people still collecting benefits remained high at 20.29 million for the week ending May 30.
The S&p 500 sold off late in the day on above-average volume to close at 3190.14. The RSI index moved out of the oversold zone and closed at 68.41, which is considered a short term sell signal for our group. We also had other indicators that trip to a sell signal, and we are now moving to short-term bearish. Potential support could come in at 3130.94 and then the 200-day moving average at 3012.40.
We are currently long-term bullish and short-term bearish.
John N. Lilly III CPFA
Accredited Portfolio Management Advisor℠
Accredited Asset Management Specialist℠
Portfolio Manager, RJ
Windsor Wealth Planners & Strategist
Futures trading is speculative, leveraged, and involves substantial risks. Investing always involves risk, including the loss of principal, and futures trading could present additional risk based on underlying commodities investments.
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.