Was The Jobs Report Perfect for Stocks?
Jobs beat, average hourly earnings miss.
Note: I have an individual stock piece coming out later this morning, so please keep an eye out for it if interested. Thank you!
Robust jobs growth but lower-than-expected earnings and an uptick in the unemployment rate. Does that keep the economy humming along but take the pressure off inflation a bit? Seems so, although I’m no economist.
From here, it leaves me in a state of looking to buy the dips. Assuming we gap higher (we are trading notably higher as of 8:50 a.m. ET), perhaps a pullback to the $422.50 on SPY and 4230 area on the SPX will give aggressive bulls an opportunity.
That’s roughly Monday and Thursday’s high.
A bit deeper fade could land us at last week’s high — $420.75 and ~4213, respectively — and the H1 10-ema combo for another shot. These are not hard buy zones, just areas of interests that I will be watching after the open.
S&P 500 — ES
The 4240-50 area has been critical resistance since September, but as the ES continues to put in higher lows, it’s got investors looking for a breakout. The jobs report will be a major driver.
Upside Levels: 4242-4250, 4275-78, 4300
Downside levels: 4215-25 (prior resistance and last week’s high), 4200, 4183, 4175
SPY
$422.50 to $423 has been resistance this week. Over that gets us $425, then the extension near $427.50. Importantly, the SPY has been building over the Q1 high.
Upside Levels: $422.50 to $423, $425, $427.50
Downside Levels: $416-18, $413
SPX
Upside Levels: 4230, 4250, 4270
Downside Levels: 4195-4200, 4170-75, 4150-53, 4130
NQ
Zooming out with a weekly chart, I wanted to highlight some of the bigger levels here. The NQ is looking for a three-week win streak but it might as well be a five-week streak given that the one week that broke it up was a 0.02% decline.
Shares are now reaching for the 61.8% of the bear-market range at 14,683. Above that opens the door to 15K. On the downside, bulls want to see the 13,900 to 14,000 area hold as support, along with the rising 10-week ema, which has been support for several months.
If that’s the case, bulls retain active control.
ARKK
Everyone loves to hate ARKK, but this is going for its first weekly close above the 50-week moving average since September 2021 (not a typo). This thing has been in a wicked downtrend, but a weekly-up over $41.28 and a strong close could fire up ARKK with a reasonable R/R for longs.
It’s why we tried to nab SHOP yesterday, but it came up just short. Many growth names have been trading better lately, just as a general observation.
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.
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX
Down to Runners in GE, CAH, LLY, ABBV, AAPL, MCD & BRK.B. Now Add META, AVGO, UBER, CRM and AMZN.
MDLZ — We got the gap-fill and 10-ema/50-day sma tag, but not a good close for MDLZ. Our luck has been good in tech, and not-so-good in “defensive stocks” lately. We’ll see how MDLZ shapes up here.
$71-72-ish a reasonable stop-loss area.
Back to Back inside days. Can we get $75-ish for a trim?
SBUX — Got us long at $98.90 off the daily-up, but not a good close (especially considering the action in the indices). $96-97 is a reasonable stop. Can do a small trim at $100 if you’d like. Ideally $102-ish is better though.
** TLT — I don’t know if we’ll fill the gap at $99.65-ish, but I will get long if we trade the mid-$99s and it holds as support.
Go-To Watchlist
*Feel free to build your own trades off these relative strength leaders*
Relative strength leaders →
MCD, PEP & KO, WMT, PG — group has been faltering, though!
LLY, CAH
NVDA, CRM, AMD
MSFT, AAPL, META
LULU, CMG, ELF
Relative weakness leaders →
PYPL
MET — worked really as a short, but I was taken out at B/E after we got our first trim
ONON
CF, MOS
PFE
GLOB
Economic Calendar
