Wall Street is set for a lower open after the S&P 500 was higher by 2.4% on Monday. Investors will be watching as the U.S. Senate will begin debates on President Biden’s $1.9 trillion coronavirus relief package. However, concerns remain over a rise in the 10-year Treasury yield signaling a possible spike in inflation and fears over high valuations in equity markets.
The S&P 500 rallied past resistance at 3870.90 to close higher at 3901.82. The trading came with advancing issues accounting for 80% of the volume signaling intense buying pressure. The RSI index moved past the middle line in support of the rally closing at 55.34. We feel the index needs another 80% upside volume day and close above potential resistance at 3928.65 for the recent selloff to potentially be over.
We are currently long-term bullish and short-term cautious.
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.