Stocks skyrocketed yesterday, but after a dismal job report in March and a string of new deaths from COVID-19 in New York, the market has again sank.
Stock prices are down overall. Only a handful of stocks escaped with small daily gains.
This is disappointing news for the bulls who were hoping for a continuous rally. The main indices climbed last week.
This week was another story, marked by a coronavirus epidemic that has only gotten worse over time.
“It always looks like something we’re headed into, not where we’re headed,” said Brian Nick, chief investment strategist at Nuveen.
“We can see the light behind us, but not in front of us. The bullish scenario disappears very quickly and the base scenario gets worse. “
The United States now has more than 261,000 confirmed cases of coronavirus, as well as 6,600 illness-related deaths. Worldwide, more than a million people have been infected.
Last month, 701,000 jobs were worsened, as reported by the United States Labor Office this morning. This is the biggest drop since 2009 after the financial crisis.
Want more FREE research and analysis on the best “invisible opportunities” in the market?
However, the deficit in the wage bill should not have surprised investors in the midst of a full-fledged pandemic.
“Today’s non-farm salary data confirms what we already knew: the US economy was doing well before the impact of COVID-19 was felt, and the impact of COVID-19 was severe Said Lauren Goodwin, multi-asset portfolio strategist. at New York Life Investments.
“Job losses will continue to increase as the national closure strengthens its grip on the US economy.”
Stocks could continue to fall, which could test the recent 3-year market trough set on Monday of last week.
In fact, a market leading stock could do just that in the coming sessions.
In the daily candlestick chart above, you can see that Facebook Inc. (NASDAQ: FB) was not immune to the COVID-19 crash. In the past two weeks, however, conditions have improved considerably for the social media giant.
Today, however, FB has finally run out of steam and fallen under its minor uptrend (shown with the yellow trend line). For this reason, and after setting a higher and lower lower, it might make sense to go short on the stock with a trade trigger of $ 149.00.
From there, FB will be relatively close to its low of Monday last week. Falling below this minimum could be catastrophic for Mark Zuckerberg & Co.
But for short-term traders, this could be a great opportunity to snatch up quick gains before a massive stock rally in the coming weeks.