After the biggest 4-day percentage loss in over a year, US equity index futures are in recovery this morning as markets seek direction. Trepidation over the economic impact of coronavirus has sparked a sharp selloff starting late last week.
In the last two days alone, the Dow Jones Industrial Average fell more than 1,900 points and the S&P 500 lost approximately $1.74 trillion worth of market capitalization. The Nasdaq dropped as much as 10% from its all-time high last week.
Markets look to be modestly recovering this morning:
- Micro E-mini S&P Futures (MES) +1.25%
- Micro E-mini Dow Futures (MYM) +1.16%
- Micro E-mini Nasdaq Futures (MNQ) +1.60%
Gold Futures (GC), a known safe haven in times of market volatility, saw a recent surge to the upside starting late last week, but has pulled back from its peak of $1691.70/oz on Monday.
The chart below shows the past 5 months of price action for Micro E-mini S&P 500 futures on a daily timeframe. A Market Watch tool has been placed to the right of the chart with an instrument link to efficiently toggle between markets. The past 4 sessions have erased all gains since last December and price dropped to a known support level in the 3085 area.
News regarding the spread and control of the COVID-19 coronavirus is sure to shake markets in the coming days. Traders should utilize risk management techniques when trading volatile markets and prepare for unexpected moves.