U.S. stock markets are set to open slightly higher despite an uptick in the U.S weekly jobless claims report. Claims increased by 1.416 million for the week ending July 18th higher than the economist expectation of 1.3 million. Also, Microsoft (MSFT) announced better-than-expected figures but is set for a lower open, and Tesla (TSLA) is set for a higher open after posting its fourth consecutive quarter of profits. Global markets were also higher overnight, although increased trade tension between the U.S. and China continues to get worse.
The S&P 500 has now formed a new trading range of 3247.77-3279.32; the index is possibly forming a continuation pattern for a new move higher. The RSI index is also moving higher in support of the current uptrend. On a longer-term chart, there a few developments that do have us cautious. Volume has been much lower during the current uptrend compared to the uptrend that ended at the June 6/8/2020 high of 323.13. The RSI made a high of 74.18, but the current RSI is only at 65.76, while the S&P 500 is higher at 3276.02. We will continue to monitor this negative divergence for sings of potential selling in the future.
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.