Rising US Unemployment Claims Drag Down Wall Street

February 19, 2021 13:11

Thursday’s unemployment report in the US was not only worse than expected, but also even worse than last week’s figure.

This weekly data is watched by the main analysts and market players because it measures the health of the labour market in the US. The report in question is published by the Department of Labor and records the number of people who are starting the application process for receiving unemployment benefits.

Yesterday, we learnt that 861,000 people applied for some type of unemployment assistance from the authorities during the last week. This figure compares badly with 848,000 the previous week, made worse by the fact that market consensus had expected an improved figure of around 765,000.

This data, together with the increase in US bond yields, caused Wall Street to close with declines of 0.38%, 0.44% and 0.72% in the Dow Jones, SP500 and Nasdaq indices respectively, thus leading these indices to seek their support levels around the 18 session average.

Rises in US bond yields led directly to a sell-off of the Nasdaq index, as they largely affect sentiment towards large technology stocks.

Technically, this week the Nasdaq is making a bearish candle after recording new all time highs last Tuesday. This has led it to look for its support level where its 18 session moving average meets the resistance level from the previous highs, thus reaching the 23.6% Fibonacci retracement level of the last upward impulse.

Despite this, the trend remains bullish and these recent pullbacks are helping to alleviate the accumulated overbought conditions that we can see in the stochastic indicator. Even so, we will have to be vigilant in the short term and see if the price is able to hold this support level or, on the contrary, it continues to decline towards its 40 session moving average around the 50% Fibonacci retracement level.

Depicted: Admiral Markets MetaTrader 5 - NQ100 Daily Chart. Date Range: 12 November 2019 - 19 February 2021. Date Captured: 19 February 2021. Past performance is not necessarily an indication of future performance.

Evolution of the last five years:

  • 2020: 43.64%
  • 2019: 35.23%
  • 2018: -3.88%
  • 2017: 28,24%
  • 2016: 7.50%

Trade With Admiral Markets

With the Trade.MT5 account from Admiral Markets, you can trade Contracts For Difference (CFDs) on over 3,000 shares from 16 of the largest stock exchanges in the world! CFDs allow traders to attempt to profit from both rising and falling markets, whilst also benefiting from the use of leverage! Click the banner below to open an account today:


The given data provides additional information regarding all analysis, estimates, prognosis, forecasts, market reviews, weekly outlooks or other similar assessments or information (hereinafter “Analysis”) published on the websites of Admiral Markets investment firms operating under the Admiral Markets trademark (hereinafter “Admiral Markets”) Before making any investment decisions please pay close attention to the following:

  1. This is a marketing communication. The content is published for informative purposes only and is in no way to be construed as investment advice or recommendation. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research.
  2. Any investment decision is made by each client alone whereas Admiral Markets shall not be responsible for any loss or damage arising from any such decision, whether or not based on the content.
  3. With view to protecting the interests of our clients and the objectivity of the Analysis, Admiral Markets has established relevant internal procedures for prevention and management of conflicts of interest.
  4. The Analysis is prepared by an independent analyst Roberto Rojas, Freelance Contributor (hereinafter "Author") based on personal estimations.
  5. Whilst every reasonable effort is taken to ensure that all sources of the content are reliable and that all information is presented, as much as possible, in an understandable, timely, precise and complete manner, Admiral Markets does not guarantee the accuracy or completeness of any information contained within the Analysis.
  6. Any kind of past or modeled performance of financial instruments indicated within the content should not be construed as an express or implied promise, guarantee or implication by Admiral Markets for any future performance. The value of the financial instrument may both increase and decrease and the preservation of the asset value is not guaranteed.
  7. Leveraged products (including contracts for difference) are speculative in nature and may result in losses or profit. Before you start trading, please ensure that you fully understand the risks involved.
Admirals An all-in-one solution for spending, investing, and managing your money

More than a broker, Admirals is a financial hub, offering a wide range of financial products and services. We make it possible to approach personal finance through an all-in-one solution for investing, spending, and managing money.