Two of the most significant reports are expected to be 1) job losses and 2) an update to the "official" US unemployment rate - currently 7.6%, expected to jump to 7.9%
Marketwatch is now anticipating the Worst job losses in 60 years
The recession tightened its grip on U.S. businesses and consumers in February, according to economists, who are predicting the largest one-month job loss in almost 60 years.
"Pink slips continue to fly," said Meny Grauman, an economist for CIBC World Markets.
With output still falling at a dizzying rate, most companies are shedding unneeded workers and cutting back the hours of those remaining. Strapped by debt and seeing their paper wealth evaporating, many consumers are spending as little as they can.
"The economic patient is still in critical condition, with little medication to relieve the pain," wrote economists Brian Bethune and Nigel Gault of IHS Global Insight. "We will have to bite the bullet."
The first week of the new month brings two of the most important economic indicators: the ISM index and the nonfarm payrolls report. Both are expected to be very grim news.
With all that digested, lets take a look at a chart of the DOW (below). As many of you know, the DOW has already fallen through 2002 support levels and is now hovering at 1997 levels. So where do we go from here?
Well, with more bad news streaming in throughout the week, I anticipate we'll close lower next Friday than we did this last Friday and expect that we may even test the 6,400 levels throughout the week...
Click Picture for Sharper Image
My comments on the Chart: 6,400 is the next serious downside support - should that fail, 5,500 (last seen in 95) becomes vulnerable; With the bad news increasing by the day, I anticipate we'll eventually see these 5K levels, but expect the markets to stage a nice bear-market rally beforehand.
Regards
Randy
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