US Markets Fall On Economic Issues

On Wednesday, the stock market of the United States finished the trading session with a decrease again, and the S&P500 fell for the fifth day in a row and recorded the longest losing series this year. The last time we saw the market falling for so many days was over one year ago, when the American legislators couldn't agree upon the question of a "fiscal break", and this time the reason for the falling market is also connected with fiscal problems of the USA.

Uncertainty concerning the budget and a ceiling of the public debt again starts to expand. The American government needs to take all necessary decisions and actions by the 17th of October. Obviously, nobody will allow a default of America, but questions always arise – such as which price will be needed to pay? In general, the heat and debate between republicans and democrats will be going on during the next two weeks and we should keep that in mind.

Yesterday, data was published on sales of new homes for August, showing an increase from the reconsidered 0.39 million to 0.421 million; besides, orders for durable goods for the same month grew by 0.1% though zero change was expected after a collapse for 7.4% one month earlier, which was reconsidered to an even more frightening figure – 8.1%. Even solid macroeconomic statistics couldn't shift the markets in a positive direction.

Today promises to be volatile, important publications for the markets are expected already from the early morning, and will end late night at the Asian session. It should be noted that following the results of the day, we shall not expect considerable changes in the mood of the traders, but during the day there is going to be a good possibility of opening positions, both according to fundamental analysis, and based on technical levels.

As for EUR/USD currency pair, the support level for today is on 1.3490. During the trading session, we can expect the pair to go up to 1.3550-1.3570. In case the Dollar is going to start to strengthen, the first level of resistance to break is based on 1.3490, where the next purpose will be 1.3450.