It was one more day of confusing trade with rumor changing the direction in the middle of the day. Once again as predicted on Dec 28th, Eur/Usd has hit the level of 1.27.
Lately the correlation of FTSE, Eur/Usd, S&P500 has been broken. Inspite of Eur/Usd falling below 1.28, European stock were down, but late rumor of "US government will provide 1 trillion dollar refinancing for housing market", changed the direction of US stock market from negative to positive. Later, White house dismissed such rumor. This days rumor are big market mover then actual facts. US has hit its debt ceiling of 15.194 trillion dollar ahead of time but the bias media hasn't made it headline.
Today, France auction was failure because of the possible downgrade threat, which lead to broad sell off in the global market. US challenger job cut showed increase of 30.6% YoY. ADP showed greater then expected strength of 325k job added. But ADP report has been 100% inaccuracy rate for the month of December. I am expecting non farm payroll to show 120-140k. Natural gas and oil inventories report showed rising inventories which means weak demand and doesn't justify growth.
Tomorrow the economic data to focus are
Europe retail sales (5 EST) expected -0.3%, higher will be bullish lower will be bearish.
Europe unemployment rate (5 EST) expected 10.3%, higher will be bearish, lower will be bullish.
Germany factor order (6 EST) expected -1.6%, lower will be bearish, and higher will be bullish.
US private payroll (8.30 EST) expected 140k, higher will be bullish, and lower will be bearish.
Unemployment rate (8.30 EST) expected 8.7%, lower will be bullish, and higher will be bearish.
Nonfarm payroll (8.30 EST) expected 120k, lower will be bearish, below 160k will be bearish. Above 160k will be bullish.
Avg. hourly earning (8.30 EST): expected -0.1%, lower will be bearish, 0.2% will be bullish.
US market is expected to open low, but if the non farm payroll shows above 150-160k new job added then the US stock market might go up till the close. I am still expecting Dow to fall below 11k, and S&P below 1100 soon.
S&P downgrade of France can now happen anytime soon. Buy any bearish stock.
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