Wall Street is set to open higher Friday morning at new all-time highs once again. The labor department’s nonfarm payrolls increased by 145,000 jobs in December, and the jobless rate held near a 50-year low of 3.5%. Economist are now predicting that the Federal Reserve will stick with their assessment of the U.S. economy being in a “good place.” Investors will now be on alert for the start of the earnings season next week.
The S&P 500 closed at a new all-time high at 3274.70 after breaking out of a two-week-long base. However, the move higher did come on lower than average volume, which is typically needed to start a new up move. The RSI index did go higer to 71.36 to support the move, but the index is now in overbought territory. Potential support will now become 3258.14 if any selling should come int the market. We believe new highs are potentially in the future, but we would like to see a pickup in volume soon.
We are currently long-term bullish and short-term bullish.
John N. Lilly III
Accredited Portfolio Management Advisor℠
Accredited Asset Management Specialist℠
Portfolio Manager, RJ
Dominguez & Jones Wealth Management Group
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.
The most closely watched of all economic indicators, the employment situation is a set of monthly labor market indicators based on two separate reports: the establishment survey which tracks 650,000 worksites and offers the nonfarm payroll and average hourly earnings headlines and the household survey which interviews 60,000 households and generates the unemployment rate.
Nonfarm payrolls track the number of part-time and full-time employees in both business and government. Average hourly earnings track employee pay while the average workweek, also part of the establishment survey, tracks the number of hours worked. The report’s private payroll measure excludes government workers.
The unemployment rate measures the number of unemployed as a percentage of the labor force. In order to be counted as unemployed, one must be actively looking for work. Other commonly known data from the household survey include the labor supply and discouraged workers.