EUR/USD
The Euro posted some solid gains against the Dollar in the last 24 hours. Investors bought on the news after the ECB cut its benchmark rate by 50 basis points, in line with expectations. However, the rally doesn’t seem to have any legs yet as investors await the release of America’s official Unemployment Rate. While we may see some more near-term gains in the EUR/USD, the rally may be deflected by our 1st tier downtrend line. The medium-term downtrend of the EUR/USD is still in command with the EU economy suffering and the Eastern European economies faltering. The EUR/USD faces multi-tiered downtrend lines and the highly psychological 1.30 area. If the U.S. Unemployment Rate is worse than expected, then we could see the EUR/USD follow U.S. equities lower due to their strong positive correlation. Fundamentally, our 1.2677 and 1.2634 resistances turn support with additional supports sitting at 1.2592 and 1.2549. To the topside, we maintain our resistance of 1.2725 with 2nd tier and top-end resistances hanging at 1.2794 and 1.2860, respectively. The EUR/USD is currently exchanging at 1.2706.
GBP/USD
The Cable is logging some healthy gains after the BOE cut its benchmark rate to record low of 0.50%. The Cable is rising above our 2nd tier downtrend line ahead of the U.S. Unemployment Rate. Despite the progress made in the GBP/USD over the last 24 hours, the debilitating medium-term downtrend line remains intact. What we are likely seeing here is a situation of oversold conditions and buying on the news. Furthermore, Britain released a better than expected PPI Input number this morning, showing an encouraging rise in inflation. However, we must not forget the BOE is considering using quantitative easing to rescue the economy since its benchmark interest rate is close to zero. Quantitative easing has not proven successful in the past, and could result in a depreciation of the Pound. As with the rest of the major Dollar paired currencies, all eyes are on the release of the official U.S. Unemployment Rate. If the number comes in weaker than expected and U.S. equities tumble as a result, we should see the Cable follow suit due to the positive correlation. Furthermore, while we could see the continuation of near-term gains in the GBP/USD our 3rd tier downtrend line looms in the distance. Fundamentally, we find resistances of 1.4292, 1.4355, 1.4409, and 1.4455. To the downside, we see supports of 1.4207, 1.4139, 1.4103, and 1.4058. The 1.45 level still serves as a psychological barrier to the upside with 1.40 serving as a cushion to the downside. The GBP/USD is currently exchanging at 1.4248.
USD/JPY
The USD/JPY continues its retraction from weekly highs as the U.S. economy stumbles. Even though the Japanese economy is in bad shape, the U.S. doesn’t seem too far off. Therefore, the investors are questioning the U.S. as a safe haven currency all around the FX markets in the last 24 hours. Therefore, the medium-term downtrend remains largely intact. With our 3rd tier downtrend and the psychological 100 mark hanging over head, the USD/JPY has its work cut out for it to the topside. Investors will of course be keeping a close eye on the Unemployment Rate coming from the U.S. this morning. If the number is disappointing and U.S. equities tumble, the USD/JPY should follow suit. Fundamentally, we maintain find resistances of 97.66, 98.25, 99.05 and 99.64. To the downside, we see supports of 97.22, 96.59, 95.98, and 95.08. The USD/JPY is currently exchanging at 97.59.
Crude Oil
Crude futures recovered from their losses on Thursday despite another day of crashing U.S. equities. With U.S. inventories declining and investors expecting increasing supply cuts coming from OPEC on March 15th, crude is finding considerable strengthen despite the economic turmoil in America. Furthermore, China continues to build their stockpiles of crude, taking advantage of what the government views as bargain prices for the essential commodity. However, U.S. unemployment is rising at a hurried pace while the economy deteriorates, placing a downward pressure on crude that is preventing it from breaking out to huge gains. Due to crude’s resilience, we have a positive near-term outlook on crude futures even if the U.S. unemployment rate comes in higher than expected today. Should crude futures rise above March highs, we anticipate heightened near-term gains. Fundamentally, we maintain our supports of $43.99/bbl, $43.39/bbl, $42.77/bbl, and $42.22/bbl.
Gold
Gold posted impressive gains Thursday in reaction to free-falling U.S. equities. Gold darted above our 2nd tier uptrend line and is currently sitting right below our previous resistance of $937.81/oz. It seems the negative correlation between gold and equities is making its grand return. If gold can hop above March highs, we could see a large surge to the upside. Gold’s uptrend seems comfortably back in play now with a bottom in the S&P futures nowhere in sight. Fundamentally, we hold our resistances of $937.81/oz and $945.57/oz with fresh resistances of $953.32/oz and $959.84/oz. To the downside, we find supports of $930.76/oz, $925.09/oz., $918.58/oz., and $910.33/oz. Gold is currently trading at $937.05/oz.
S&P
The S&P futures got slammed again yesterday with negative news coming from all directions. Moody’s cut its debt rating on JPMorgan and is considering doing the same for Bank of America and Wells Fargo. The news sent financials tumbling and brought the rest of the market along for the ride. It’s hard to miss the fact Citigroup trading under $1/share on Thursday, creating an incredibly negative psychological impact on equity markets. Furthermore, GM dropped below $2/share, making the company’s sustainability doubtful. Investor uncertainty is rampant, and there is no bottom in sight at this point. We still haven’t seen a strong rally stemming from oversold condition which can be molded into something more substantial. Therefore, we maintain our near-term negative outlook on the S&P futures. The psychological 700 level is long gone, and investors will need some unexpected positive news to turn the markets around. Investors are eagerly awaiting the release of the official U.S. Unemployment Rate Friday morning. Some traders are predicting a capitulation point if the number is worse than analyst expectations. However, even if this does happen, it will likely be temporary since there is no substantial positive news or data to justify a legitimate bottom. Meanwhile, the 30 Year T-Bond futures are looking to breakout to the upside and Gold is rallying. If these trends continue, then they indicate a continuation of the selloff in U.S. equities. Fundamentally, we find resistances of 690, 696, 701.75, and 709.25. To the downside, we see support of 683 with 2nd tier witting at 675.25. We can’t find any other near-term supports, usually a negative sign. The S&P futures are currently trading at 684.25.
30 Year
The 30 Year T-Bond futures surged on Thursday with the S&P futures continuing their freefall. Despite the rising supply of long-term treasury bonds in order to raise capital for the government’s large stimulus plan, the negative correlation between bonds and equities has been reactivated. The 30 Year T-Bond futures rose well above all of our previous resistances are approaching our uptrend line with the downtrend lines fading into the distance. We expect the continuation of sizeable near-term gains should the 30 Year futures climb above February highs. With the U.S. Unemployment Rate on deck and the S&P futures looking to open in the red again, the environment is suitable for a run in the 30 Year T-Bond futures. Fundamentally, we find fresh resistances of 129.3125, 129.891, 130.375, and 131.109. To the downside, see supports of 128.5156, 127.8125, and 127.4219. The 30 Year Treasury Bond futures are currently trading at 129 04.0.
The Euro posted some solid gains against the Dollar in the last 24 hours. Investors bought on the news after the ECB cut its benchmark rate by 50 basis points, in line with expectations. However, the rally doesn’t seem to have any legs yet as investors await the release of America’s official Unemployment Rate. While we may see some more near-term gains in the EUR/USD, the rally may be deflected by our 1st tier downtrend line. The medium-term downtrend of the EUR/USD is still in command with the EU economy suffering and the Eastern European economies faltering. The EUR/USD faces multi-tiered downtrend lines and the highly psychological 1.30 area. If the U.S. Unemployment Rate is worse than expected, then we could see the EUR/USD follow U.S. equities lower due to their strong positive correlation. Fundamentally, our 1.2677 and 1.2634 resistances turn support with additional supports sitting at 1.2592 and 1.2549. To the topside, we maintain our resistance of 1.2725 with 2nd tier and top-end resistances hanging at 1.2794 and 1.2860, respectively. The EUR/USD is currently exchanging at 1.2706.
GBP/USD
The Cable is logging some healthy gains after the BOE cut its benchmark rate to record low of 0.50%. The Cable is rising above our 2nd tier downtrend line ahead of the U.S. Unemployment Rate. Despite the progress made in the GBP/USD over the last 24 hours, the debilitating medium-term downtrend line remains intact. What we are likely seeing here is a situation of oversold conditions and buying on the news. Furthermore, Britain released a better than expected PPI Input number this morning, showing an encouraging rise in inflation. However, we must not forget the BOE is considering using quantitative easing to rescue the economy since its benchmark interest rate is close to zero. Quantitative easing has not proven successful in the past, and could result in a depreciation of the Pound. As with the rest of the major Dollar paired currencies, all eyes are on the release of the official U.S. Unemployment Rate. If the number comes in weaker than expected and U.S. equities tumble as a result, we should see the Cable follow suit due to the positive correlation. Furthermore, while we could see the continuation of near-term gains in the GBP/USD our 3rd tier downtrend line looms in the distance. Fundamentally, we find resistances of 1.4292, 1.4355, 1.4409, and 1.4455. To the downside, we see supports of 1.4207, 1.4139, 1.4103, and 1.4058. The 1.45 level still serves as a psychological barrier to the upside with 1.40 serving as a cushion to the downside. The GBP/USD is currently exchanging at 1.4248.
USD/JPY
The USD/JPY continues its retraction from weekly highs as the U.S. economy stumbles. Even though the Japanese economy is in bad shape, the U.S. doesn’t seem too far off. Therefore, the investors are questioning the U.S. as a safe haven currency all around the FX markets in the last 24 hours. Therefore, the medium-term downtrend remains largely intact. With our 3rd tier downtrend and the psychological 100 mark hanging over head, the USD/JPY has its work cut out for it to the topside. Investors will of course be keeping a close eye on the Unemployment Rate coming from the U.S. this morning. If the number is disappointing and U.S. equities tumble, the USD/JPY should follow suit. Fundamentally, we maintain find resistances of 97.66, 98.25, 99.05 and 99.64. To the downside, we see supports of 97.22, 96.59, 95.98, and 95.08. The USD/JPY is currently exchanging at 97.59.
Crude Oil
Crude futures recovered from their losses on Thursday despite another day of crashing U.S. equities. With U.S. inventories declining and investors expecting increasing supply cuts coming from OPEC on March 15th, crude is finding considerable strengthen despite the economic turmoil in America. Furthermore, China continues to build their stockpiles of crude, taking advantage of what the government views as bargain prices for the essential commodity. However, U.S. unemployment is rising at a hurried pace while the economy deteriorates, placing a downward pressure on crude that is preventing it from breaking out to huge gains. Due to crude’s resilience, we have a positive near-term outlook on crude futures even if the U.S. unemployment rate comes in higher than expected today. Should crude futures rise above March highs, we anticipate heightened near-term gains. Fundamentally, we maintain our supports of $43.99/bbl, $43.39/bbl, $42.77/bbl, and $42.22/bbl.
Gold
Gold posted impressive gains Thursday in reaction to free-falling U.S. equities. Gold darted above our 2nd tier uptrend line and is currently sitting right below our previous resistance of $937.81/oz. It seems the negative correlation between gold and equities is making its grand return. If gold can hop above March highs, we could see a large surge to the upside. Gold’s uptrend seems comfortably back in play now with a bottom in the S&P futures nowhere in sight. Fundamentally, we hold our resistances of $937.81/oz and $945.57/oz with fresh resistances of $953.32/oz and $959.84/oz. To the downside, we find supports of $930.76/oz, $925.09/oz., $918.58/oz., and $910.33/oz. Gold is currently trading at $937.05/oz.
S&P
The S&P futures got slammed again yesterday with negative news coming from all directions. Moody’s cut its debt rating on JPMorgan and is considering doing the same for Bank of America and Wells Fargo. The news sent financials tumbling and brought the rest of the market along for the ride. It’s hard to miss the fact Citigroup trading under $1/share on Thursday, creating an incredibly negative psychological impact on equity markets. Furthermore, GM dropped below $2/share, making the company’s sustainability doubtful. Investor uncertainty is rampant, and there is no bottom in sight at this point. We still haven’t seen a strong rally stemming from oversold condition which can be molded into something more substantial. Therefore, we maintain our near-term negative outlook on the S&P futures. The psychological 700 level is long gone, and investors will need some unexpected positive news to turn the markets around. Investors are eagerly awaiting the release of the official U.S. Unemployment Rate Friday morning. Some traders are predicting a capitulation point if the number is worse than analyst expectations. However, even if this does happen, it will likely be temporary since there is no substantial positive news or data to justify a legitimate bottom. Meanwhile, the 30 Year T-Bond futures are looking to breakout to the upside and Gold is rallying. If these trends continue, then they indicate a continuation of the selloff in U.S. equities. Fundamentally, we find resistances of 690, 696, 701.75, and 709.25. To the downside, we see support of 683 with 2nd tier witting at 675.25. We can’t find any other near-term supports, usually a negative sign. The S&P futures are currently trading at 684.25.
30 Year
The 30 Year T-Bond futures surged on Thursday with the S&P futures continuing their freefall. Despite the rising supply of long-term treasury bonds in order to raise capital for the government’s large stimulus plan, the negative correlation between bonds and equities has been reactivated. The 30 Year T-Bond futures rose well above all of our previous resistances are approaching our uptrend line with the downtrend lines fading into the distance. We expect the continuation of sizeable near-term gains should the 30 Year futures climb above February highs. With the U.S. Unemployment Rate on deck and the S&P futures looking to open in the red again, the environment is suitable for a run in the 30 Year T-Bond futures. Fundamentally, we find fresh resistances of 129.3125, 129.891, 130.375, and 131.109. To the downside, see supports of 128.5156, 127.8125, and 127.4219. The 30 Year Treasury Bond futures are currently trading at 129 04.0.
