Morning Call by Traders University

Yesterday the government launched a debt insurance plan for banks causing the FTSE to close up 66 points at 3915. RBS rocketed up from 6p to 29p while Lloyds also rose from 17.5p to 75p. The government hopes the Asset Protection Scheme will boost lending by reducing banks’ uncertainty about the value of past investments. The Dow tested the 7400 resistance level for the second day and dropped steadily throughout the whole day to close at a loss of 89 points at 7182. The decline away from 7,400 indicates the index may test lows at around 7,115 soon and could put in new lows for the weekend. The daily chart also shows that the entire week trading range has been consolidating beneath the major support at 7,450 and that is highly indicative of weakness ahead. A quiet day today in Forex related data releases with the USD Preliminary q/q GDP being the only release to note at 1.30 pm which is expected to fall significantly. Yesterday we had a series of poorer than expected figures from the US. Core Durable Goods Orders, Unemployment Claims and New Home Sales all came in lower than expectations.