U.S. stock futures are lower this morning as increased coronavirus cases threaten to slow down economic recovery. Investors are also concerned that a COVID-19 relief bill and a $1.4 trillion spending bill will not be passed. The U.S. Congress will vote this week on a one-week stopgap funding bill to provide more time for a deal before the end of the year. Third-quarter GDP increased at an annualized rate of 66.1% after some lockdowns are restrictions were lifted across the country. Investors will be dealing with a mixed bag of news as the trading day begins today.
The S&P 500 traded below support at 3682.73 briefly and then moved higher to end the day at 3691.96. The index is still above the long term trend line for now, but further selling could potentially be the next move. We feel the selling would be tame and not go below the potential support at 3645.99. We also think the market is overbought, short term, and any selling would, possibly, be met with new buys due to an uptrend being in place since late November.
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.