U.S. stock futures are set to open lower today to continue the selling that came into markets on Tuesday. Manufacturing activity in the U.S. unexpectedly slowed last month, which shows companies are starting to feel the pinch of the ongoing U.S.- China trade dispute. The U.S factory activity index fell to its lowest level in more than a decade. The news will make an already important Federal Reserve meeting later this month even more critical. Earlier on Wednesday, the ADP employment report showed employers hired fewer than expected employees than expected in September. Investors will now focus on Friday’s jobs report for confirmation of a possible slowdown in economic growth.
The S&P 500 sold off and move down to important support at closed at 2940.25 on Tuesday. The RSI index also moved lower to close at 44.08, confirming the selling on the day. The trading did come on average volume, and the index is now getting into oversold territory. We will remain long term bullish and short term bullish unless the 2940.43 level is taken out with high volume. If that support level is taken out, we will move to short term bearish and start to watch for possible support levels at 2938.84 and 2891.85.
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.