The World Bank Sparks Another Sell-Off?
Monday, March 09, 2009
Economic news continued to drag down the major stock markets Monday morning as the World Bank said over the weekend that the global economy is likely to shrink for the first time in over 60 years, due to global economic contraction. In addition to the news published over the weekend, the U.S released a gloomy figure on Friday, showing that their unemployment level had jumped to 8.1% while the NFP result showed an additional 651,000 job losses.
The result had an enormous effect on investor sentiment as they realized that further job losses means further economic contraction, due to the lack of consumer consumption. Over the last couple of weeks, consumer consumption has dropped significantly as citizens would rather allocate their money to savings rather than spend it in the free market.
Friday’s U.S stock session started on the wrong foot, but the major indices managed to retreat with the help of energy stocks. The Energy sector finished the session up by 1.09% while Health care showed the most intraday gains, closing the session 1.46% higher. The drag-down of the session was the financial sector, failing to reverse throughout the session, finishing in red.
The markets opened another day in red this morning, starting in Asia and spreading to the European markets. Futures in the U.S are currently pointing towards a negative session.
Dollar continues to maintain strength
On the Forex market the Dollar index jumped higher on economic worries Monday morning, climbing back above the 88.97 level. When using multiple time frames one can see that further Dollar strength is possible but the Dollar could be stopped in its tracks due to minor resistance at 89.48. On individual currency pairs, the pound is now breaking trend line support. Even though the intraday trend is currently showing a clear break, one should receive confirmation to avoid a “false”. Further information was provided on the video analysis prior to the break out.
Crude is testing resistance
Crude oil continued higher during Friday’s session but is now retracing back to the $45 mark. Indicators are now pointing to slight divergence on the smaller time frames and intense selling pressure across the board could keep this commodity from breaking out of range. (Above $46)
Looking forward
As the economic calendar is lacking major market moving data today, most eyes will be focusing on housing starts from Canada. Forex traders especially will be observing the USD/CAD as the pair is now trading around major resistance.
USD/CAD - 4 hour Chart
Market Pivot Points
Monday, March 09, 2009
Economic news continued to drag down the major stock markets Monday morning as the World Bank said over the weekend that the global economy is likely to shrink for the first time in over 60 years, due to global economic contraction. In addition to the news published over the weekend, the U.S released a gloomy figure on Friday, showing that their unemployment level had jumped to 8.1% while the NFP result showed an additional 651,000 job losses.
The result had an enormous effect on investor sentiment as they realized that further job losses means further economic contraction, due to the lack of consumer consumption. Over the last couple of weeks, consumer consumption has dropped significantly as citizens would rather allocate their money to savings rather than spend it in the free market.
Friday’s U.S stock session started on the wrong foot, but the major indices managed to retreat with the help of energy stocks. The Energy sector finished the session up by 1.09% while Health care showed the most intraday gains, closing the session 1.46% higher. The drag-down of the session was the financial sector, failing to reverse throughout the session, finishing in red.
The markets opened another day in red this morning, starting in Asia and spreading to the European markets. Futures in the U.S are currently pointing towards a negative session.
Dollar continues to maintain strength
On the Forex market the Dollar index jumped higher on economic worries Monday morning, climbing back above the 88.97 level. When using multiple time frames one can see that further Dollar strength is possible but the Dollar could be stopped in its tracks due to minor resistance at 89.48. On individual currency pairs, the pound is now breaking trend line support. Even though the intraday trend is currently showing a clear break, one should receive confirmation to avoid a “false”. Further information was provided on the video analysis prior to the break out.
Crude is testing resistance
Crude oil continued higher during Friday’s session but is now retracing back to the $45 mark. Indicators are now pointing to slight divergence on the smaller time frames and intense selling pressure across the board could keep this commodity from breaking out of range. (Above $46)
Looking forward
As the economic calendar is lacking major market moving data today, most eyes will be focusing on housing starts from Canada. Forex traders especially will be observing the USD/CAD as the pair is now trading around major resistance.
USD/CAD - 4 hour Chart
Market Pivot Points