U.S. stock futures are lower as investors are worried about a coronavirus increase domestically and overseas and the possibility of new lockdowns halting economic recovery. Daily U.S. cases have risen by a record of 69,967 over the past week, while hospitalizations are higher 5% or more in 36 states. Also, hopes of a stimulus relief package are dwelling after limited progress in negotiations between the two sides. Microsoft (MSFT) reported better-than-expected earnings and revenue for the third quarter, but the stock was lower by 1.9% in pre-market trading.
The S&P 500 closed lower at3390.68 on above-average volume again on Tuesday after attempting to break through the 50-day moving average at 3408.60. The RSI index also moved lower in support of the selling closing at 46.24. We feel the selling will potentially pick up from here and test possible support at 3354.69. If that level should not hold, the next potential support level could come in at 33265.44. However, another heavy day of selling should have the index close to oversold and setup possible buying at lower prices.
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.
This is not a recommendation to buy or sell any company’s stock mentioned above.