Wall Street closed in red territory Tuesday as trade data led some economists to lower forecasts for economic growth and after a survey signalled heightened cynicism among small business owners. After a nearly 150-point drop, the Dow Jones Industrial Average closed down 117.53 points to 12,263.58, its biggest point and percent drop since March 16. The Standard & Poor 500 Index declined 10.3 points to 1,314.16 while the Nasdaq Composite Index slid 26.72 points to 2,744.79.
Asian shares fell Tuesday on selling prompted by news that Japan’s nuclear crisis has deteriorated to a level matching the Chernobyl disaster and after the International Monetary Fund said global economic growth should slow this year on emerging new risks. In foreign-exchange trade, the fresh worries surrounding Japan’s nuclear crisis kept risk-sensitive currencies such as the euro and the Australian dollar pressured for most of the session. More recently, the U.S. dollar was at 83.32 yen, from 84.61.
Yesterday, we predicted that crude oil will rise to $110.00 a barrel. Amazingly, oil price climbed right up to our target take-profit, and then stumbled to its lowest in nearly two weeks as a rash of pessimistic U.S. economic growth forecasts rekindled fears of diminished oil demand. Light, sweet crude fell $3.67, or 3.3%, to settle at $106.25 a barrel on the New York Mercantile Exchange. That was oil’s lowest settlement since March 30. That was also oil’s biggest one-day percentage drop in a month and it follows a decline of 2.5% on Monday. Prices have fallen 5.8% since Friday. Look for this trend to continue in the coming days.
Today’s Important Economic Announcements (GMT)
9:30 AM GBP Claimant Count Change & Average Earnings Index
10:00 AM EUR Industrial Production m/m
1:30 PM USD Retail Sales m/m
3:00 PM USD Business Inventories m/m
3:30 PM CAD BOC Monetary Policy Report
3:30 PM Crude Oil Inventories
4:15 PM CAD BOC Press Conference
6:00 PM AUD RBA Gov Stevens Speaks
10:00 PM EUR Buba President Weber Speaks
S&P 500
As mentioned in the first passage of today’s fundamental analysis, U.S. stocks fell sharply Tuesday. This bearish environment is due to the tax season selling pressure. This phenomenon occurs every April, and this year it is right on schedule. There’s no telling as to how much of a negative reaction the markets will continue to have given the recent earthquakes out of Japan. We expect to see 1280 before real support kicks in. Traders should expect the negative market sentiment to continue.
Stop Loss: 1318.00
Take Profit: 1280.00
Natural Gas
Natural gas futures were down on Tuesday, amid speculation of reduced demand after forecasts showed moderate temperatures in key gas-heating areas in the U.S. through mid-April Natural gas futures traded at $4.069 during U.S. morning trade, tumbling 1.32%. It earlier fell to a daily low of $4.058. If you have been following our daily analyses, you surely know that we been recommending short selling this commodity for weeks. Our target price remains at the strong psychological support level of $4.00. We could reach it today or in the next few days.
Stop Loss: 4.142
Take Profit: 4.000
EUR/USD
So far this morning, slight decrease in the Euro/Dollar commenced recovering after yesterday’s gain of about 140 pips. The European currency appreciated from 1.4376 to 1.4519 yesterday, matching the positive interbank sentiment projection at almost +11%, closing the day at 1.4471. Today’s focus is on France CPI and HICP, Germany Wholesale prices and EU16 Industrial production, at 5:30, 6 and 9 GMT respectively. A possible double top forming on the 4h EUR/USD charts this morning, as we’ve seen some heavy selling pressure under 1.4500 for the second time this week. A double-top is usually a bearish signal which means short positions are encouraged.
Stop Loss: 1.4511
Take Profit: 1.4384
Written by SolidityBrokers.com
