U.S. stock futures are higher after a better than expected weekly jobless claims report was released. Initial claims for state unemployment benefits totaled a seasonally adjusted 473,000 compared to 507,000 the prior week. The report shows employers were able to retain employees during the growing labor shortage. There are 8.1 million job openings and nearly 10 million people officially unemployed in the U.S. Meanwhile, the Producer’s price index for final demand rose 0.6%, which was another sign inflation is creeping into the U.S. economy.
The S&P 500 moved below support at 4128.59, and then the more important level at 4068.31. The index closed at 4063.04, with volume coming in at 2,398,136,832. The RSI index moved below the 50 level, closing at 41.05 in support of the heavy selling. The index must now hold the critical 50-day moving average that is now at 4094.94. If that potential support is broken, the next possible support level could become 3983.87. However, the S&P 500 is now near the 38.2% retracement level that typically brings in some buyers.
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, RJFS
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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