Estimates for jobless claims had expected 175K, we saw 190 instead..Unemployment has now topped 10 percent at 10.2… With the News Media heralding “The worst unemployment since 1983″… Nothing like bad news to lead off a news cycle…Again, we see the psychological significance of the round number…In response,the markets are basically sideways to slightly lower.
On a different note, look at the 1.50 level in the Euro/Dollar trade. If the Euro can substantially pop above the 1.50 level on the charts, it bodes for further strengthening of the Euro and and equal weakening of the US Dollar from its current 76 level to a target down around 66..
Such a move undoubtedly would make commodities more expensive, if for no other reason than the currency issue.
At that point, we will hear more rumors of meetings by foreign nations about switching from the US Dollar to another currency of choice, or perhaps a basket…Such a move most likely will be spearheaded by OPEC nations, who are getting paid in US dollars for their Oil, and are therefore watching their currency holdings becoming less and less valuable.
Again, this is all assuming that over the next year or so the Dollar really does sink to new all-time lows against other currencies.
Such a currency move would undoubtedly be marked by gold moving well above its current levels, hence the talk of 2000 or 3000 dollar an oz gold.
Good Trading