U.S. stock futures are flat to start the day, and the yield on the 10-yr Treasury moved lower down to 1.34% this morning. The decrease in interest rates comes as expectations for inflation to improve and that growth rates are decelerating. Investors appear to now favor growth stocks again and, in particular large technology stocks. Apple (AAPL) and Amazon (AMZN) are both up double digits compared to the S&P 500, up only 2.8% in the past month. Later today, the minutes from the June 15-16 FOMC meeting will be released, and they will be scrutinized for any comments about when the Fed could start tapering asset purchases.
The S&P 500 sold off below current support at 4326.60 only to rally late in the day and close at 4344.00. There was an increase in volume with 2,071,081,472 shares traded, and RSI moved out of the oversold zone closing at 69. We feel there is the potential for more selling, and yesterday may have been a shot across the bow. If so, potential support will remain at 4326.60 and then 4300.73. However, we also still believe any selling would present a possible buying opportunity due to an uptrend still in place.
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, 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.
This is not a recommendation to buy or sell any company’s stock mentioned above.
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