Dow Retreats on Jobless Claims Disappointment
The Dow retreated 170 points today as jobless claims disappoints, putting pressure on an already scared market.
Fundamentals
US market took a hit today as jobless claims turned in worse than expected before market opened. Analysts were expecting jobless claims to turn in lower this week at 405K versus last week's 412K revised number but it turned in at 417K instead, which is not only higher than expected but was also higher than last week. Jobless claims seems to be bouncing around the 450K and 400K level whole year long this year so far, taking the decline in Jobless claims since 2009 to a screeching stop. In fact, over the course of the year, jobless claims seemed to have been on a slight up trend, which is of course a bad sign for an economy struggling to recover from an economic crisis. Analysts are also expecting a lower Real GDP for second quarter preliminary tomorrow, which also added to the cautiousness in the market, leading investors and traders to take some short term profit off the table.
Technicals
Despite making a strong negative day today, the Dow continued to make an expanding day of a higher high and higher low along with rising short term bullish momentum and strong volume. This suggests that the Dow may still continue its way to its 30MA as I have mentioned before where it will test for strength and perhaps make a new leg down on this intermediate bear trend.
For now, the Dow remains in a short term neutral trend within an intermediate bear trend and primary bull trend.
Fundamentals
US market took a hit today as jobless claims turned in worse than expected before market opened. Analysts were expecting jobless claims to turn in lower this week at 405K versus last week's 412K revised number but it turned in at 417K instead, which is not only higher than expected but was also higher than last week. Jobless claims seems to be bouncing around the 450K and 400K level whole year long this year so far, taking the decline in Jobless claims since 2009 to a screeching stop. In fact, over the course of the year, jobless claims seemed to have been on a slight up trend, which is of course a bad sign for an economy struggling to recover from an economic crisis. Analysts are also expecting a lower Real GDP for second quarter preliminary tomorrow, which also added to the cautiousness in the market, leading investors and traders to take some short term profit off the table.
Technicals
Despite making a strong negative day today, the Dow continued to make an expanding day of a higher high and higher low along with rising short term bullish momentum and strong volume. This suggests that the Dow may still continue its way to its 30MA as I have mentioned before where it will test for strength and perhaps make a new leg down on this intermediate bear trend.
For now, the Dow remains in a short term neutral trend within an intermediate bear trend and primary bull trend.
posted by Jason Ng at 8:03 PM
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