U.S. stock futures are lower after China reported weak retail sales, possibly signaling a fragile economic recovery. Bank of America (BAC) moved lower pre-market after reporting a 50% decline in second-quarter profits, and the company announced they would be setting aside $4 billion for potential loan losses. U.S. retail sales increased more than expected as sales rose 7.5% last month, and 1.30 million people filled for state unemployment benefits the week of July 11th.
The S&P 500 moved up to resistance at 3233.13 and was rejected closing at 3226.56. However, the days trading action was a clear breakout of a small trading range that came with increased volume. The RSI index also moved substantially higher in support of the breakout. We feel the index could now form another trading range before attempting to move past resistance at 2233.13. Any pullbacks should would probably only be profit-taking and a good setup for potential new buying.
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.
This is not a recommendation to buy or sell any company’s stock mentioned above.