Wall Street is set to open lower today after a U.S. airstrike killed the top Iranian military commander. The news has escalated the geopolitical tensions in the Middle East and the price of oil. The current price of a barrel of oil is up nearly 4% amid speculation about disruptions in production. Investors, this morning, are moving to risk-free assets such as U.S. Treasuries and gold to protect against further market pullbacks.
The S&P 500 closed as another all-time high on Thursday at 3257.85, and RSI is now in the overbought zone at 75.48. Markets can continue higher while overbought, but the short-term risk is now much higher than at the start of the week. The only potential resistance could be the top of a vertical trend line, and our best guess at that price level is 3260. Potential support could come in at the 3212.03 level. The index did breakout to yesterday, and we feel it best to respect the current uptrend for now.
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.
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