Market Outlook: Current Scenario Is Similar To The 'Flash Crash'

As the economic calendar slowly picks up following the NFP lull, we are looking at a busy week both globally and in the US, where an army of Fed speakers culminates with a Yellen speech on Friday at 1pm in Rhode Island. As DB notes, the start to the week is rather quiet with just May NAHB housing market index in the US.

This post ‘Red’ Is The New ‘Black’ In Saudi Arabia appeared first on Daily Reckoning. What a weekend! Thanksgiving, huh? Could’ve fooled me. On Friday — “Black Friday” for shoppers — oil prices fell to four year-lows, unseen since the post-crash recovery days of 2010. Meanwhile, in trading pits across the globe, panic prevailed and red ink (or “blood,” if the analogy suits you) flowed. For oil, it seems, red is the new black.

Some weeks feature a contrast between past and future — a possible inflection point. Here are the current elements:

By Price Headley: Despite last Monday's decimation and Tuesday's and Wednesday's go-nowhere sessions, a strong Thursday and Friday meant the market managed to make a gain last week. In fact, last week's bar (in its entirety) has many of the tell-tale signs of a bullish reversal. So are these bullish clues telling us our current situation is going to lead to bullishness? Not quite yet - there's one more hurdle to clear before we can safely say the uptrend is "on" again.

This week, markets are likely to focus on US ISM Nonmanufacturing, services and composite PMIs in the Euro area (expect increases), ECB’s Monetary Policy Decision (expect no change in policy until further ahead), and Congressional testimony by Fed’s Yellen.

By Jarred Cummans:Today marked the end of a tumultuous week that saw high volumes accompanied by high volatility. The week saw poor trading days until Thursday came, when all hell broke loose. A massive sell off led to losses of more than 3% in most major benchmarks, as investors hit the panic button in reaction to Fed Chair Ben Bernanke’s speech and policy decisions.

By Price Headley: We knew we were due for a dip after the heroic rally three weeks ago; last week we got it. Still, it wasn't enough to snap the overall uptrend, nor the spirits of the bulls … traders ended things on Friday in a buying mood, not wanting to head into the weekend empty-handed in case the budget crisis was resolved and/or Europe doesn't fall into the ocean.