Jobs Report Tops Expectations. Now What?
I don't envy the Fed's job.
Technical Edge
NYSE Breadth: 32% Upside Volume
Advance/Decline: 28% Advance
VIX: ~$19
The labor report was pretty strong, with every main metric topping expectations. I’m not an economist, so I will only theorize so much.
However, it does put the Fed in a tough spot. Jobs and wages are up and the unemployment rate is down. That’s going to make inflation harder to kill, while higher rates are contributing to a more stressed financial system.
On the other hand, the economy/jobs market is stronger than expected, which is a positive (broadly speaking).
As much as we all want to see inflation come down — for our own sake and in regards to the Fed’s agenda — no one (or no one should) want to see catastrophic economic turmoil.
Enough.
I’ll get off my soapbox so we can look at some levels.
Remember: Exercise patience. We can afford to wait for the prime setups, even if it means scaling back and getting through a couple of these tougher sessions (Fed, AAPL earnings, Jobs report, etc.)
S&P 500 — ES
Down four days in a row but trying to hold last week’s low
Upside Levels: 4120-25, 4135, 4150, 4175-80
Downside levels: 4060-65, 4025-30
SPY
Gapped below $408 and couldn’t fill it yesterday. Now we have to see if the SPY can hold last week’s low, which it did quite well on Thursday.
Upside Levels: $408, $410.50 to $411, $412.50
Downside Levels: $403 to $403.50, $399 to $400
SPX
Key Pivot: 4050
Upside Levels: 4090, 4113, 4130, 4150
Downside Levels: 4035, 4000, ~4075-80
QQQ
Upside Levels: $320, $322.50, $323.65, $325
Downside Levels: $315, $312.50, $309.90
NQ
Notice that, despite all the noise, we are basically just stuck between 12,950 and 13,300.
Upside Levels: 13,175, 13,230, 13,300-10
Downside Levels: 13,000, 12,925 to 12,950
Open Positions
Bold are the trades with recent updates.
Italics show means the trade is closed.
Any positions that get down to ¼ or less (AKA runners) are removed from the list below and left up to you to manage. My only suggestion would be B/E or better stops.)
** = previous trade setup we are stalking.
Down to Runners in GE, CAH, LLY, ABBV, AAPL, MCD & BRK.B
** WYNN — watching for the breakout over ~$117, but not expecting it today.
** CMG — Closely watching that buy-the-dip setup.
Go-To Watchlist
*Feel free to build your own trades off these relative strength leaders*
Relative strength leaders →
MCD, PEP & KO, WMT, PG — XLP
LLY
NVDA, CRM
MSFT, AAPL, META
PANW, FTNT (10-week/50-day combo & prior breakout level)
ULTA, LULU, CMG
GE
HCA
DKS
WYNN
MELI
Economic Calendar
