The Nikkei busted through the 13,000 level and plummeted over 430 points. The Dow has plunged over 100 points so far and can't seem to hold the 12,000 level.
More jobs were lost as we found out in this morning's Non-Farm Payroll report. There was a loss of over 60,000 jobs this month and last month's loss was revised even worse also (-22,000).
You can see from the chart below that if the Dow doens't close above the 12,000 level...that it's not going to be good. Look out below!!!
The Dow threatens to break (Dow)n!
This is going to push the EUR/JPY carry trade down towards the 153.00 minimally. Check out it's long term yearly chart support line below.
EUR/JPY heads lower towards its yearly support level.
Hold onto your hat. It's not going to be pretty in stocks...but it can be a great thing for the short sellers of these carry trades such as EUR/JPY.
Unfortunately, things will probably worsen for the U.S. economy in the near term which will just encourage stocks and carry trades lower.
Hiring and firing trends don't usually turn around on a dime. Now sometimes they'll have improved months in the midst of a longer downturn...just like a stock chart can have. But don't be fooled just because we get a favorable payrolls report here or there over the next few months. Even downtrends have "rallies upward". Yet they're still downtrends. Trends in employment are very much the same.
Sean Hyman
Editor/Trader
www.money-trader.com
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