U.S. stock futures are lower ahead of Federal Reserve Chairman Jerome Powell’s speech at the Jackson Hole Economic Policy symposium. The highly-anticipated speech is important because the Fed could adopt and “average inflation target.” The potential policy would let inflation run past 2.0% year over year to balance out the years when inflation ran below 2.0%. Also, this morning the number of Americans filing new unemployment claims remained around 1 million last week and showed the economy could be stalling due to the ongoing COVID-19 pandemic.
The S&P 500 is now a five-day winning streak, and the RSI index has moved well into the overbought range closing at 76.81. The volume has not picked up during the rally showing selective stocks only have been moving markets higher. So, we feel some selling could possibly come in over the next few days. Potential support is now at 3444.15, 3413.13, and then 3392.52. However, we feel the selling could be short-term, allowing potential dip buyers to come back in and resume the uptrend.
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.