U.S. stock futures are higher to start the day as bargain-hunting investors are buying tech stocks that recently sold off. This morning, Nasdaq futures had gained 1.3%, and S&P 500 futures had gained 0.5%. The futures were lower to start the day after AstraZeneca (AZN) said a late-stage trial of its Covid-19 vaccine had been put on hold. The company reported a suspected severe adverse reaction in trial participants in the U.K. Later today, the Labor Department will report the Labor Turnover survey for July, and the report will be watched closely for insight into the health of the labor market.
The S&P 500 moved below support at 3349.63 to close at 3331.84 on Tuesday. The recent three-day sell-off has come with increased volume, and we feel a new downtrend is possibly in place. The RSI index also moved below the 50 level, closing at 42.64 in support of the selling. The next level of potential support could come in at 3284.53, and possible resistance could come in at 3349.63. The critical 50-day moving average at 3305.37 could also provide potential support. After such heavy selling, a snapback rally is a possibility today, but we will remain cautious until buyers take back control of the markets.
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.
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