U.S. stock futures are trading lower after the rise in new coronavirus cases across the United States. Fears of another lockdown to halt the virus has caused investors to head for safer assets to start the day. Also, initial claims for state unemployment benefits came in at 1.480 million for the week ended June 20, down from 1.540 million last week. Even though businesses have reopened, some economist are now predicting the labor market could take years to cover after the COVID-19 pandemic.
The S&P 500 sold off down to the important 200-day moving average at 3020.38 and then closed at 3050.33. The RSI index moved below the 50 level, and volume picked up at the selling increased. The index is now outside the recent trading range and is in danger of moving below potential support at 3020.38. We are hopeful the level will hold today and not possibly create more panic selling.
We are currently long-term bullish and short-term bullish.
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.