U.S. stock futures were flat as investors reacted to the January retail sales report and release of the latest FOMC minutes. The Federal Reserve is expected to keep monetary policy loose and keep interest rates low until inflation rises to 2%. The Commerce Department reported that January sales surged by a seasonally adjusted rate of 5.3%. Also, consumers increased savings, which was reported at $2.38 trillion in December. The U.S. economy is now forecast to grow by 4.3% in 2021.
The S&P 500 moved to a new all-time trading high of 3950.43 but sold off almost immediately to close lower at 3932.59. There was a pick in volume with 2,283,136,000 shares traded. The rejection of a new closing high with higher volume shows the index may be moving too far too fast, and more basing action might be needed to start a new uptrend. The RSI index did not move higher along with the S&P 500 and provided more proof of an index that is not ready to move higher just yet.
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.