It's gonna be a short one because nothing has changed since yesterday. All eyes are now on tomorrow morning's jobs report, and given the heightened levels of either anxiety (for the bulls) or hope (for the bears) related to the S&P's recent dip below 1000, I suspect there will be fireworks just after 8:30am ET. With regard to the report, I will repeat what I always say just before one of these scheduled events: the market already knows what it wants to do and will just use the report as an excuse to do it. It does not matter one iota whether the consensus expectation is exceeded or missed. The important information for us traders comes after the report in the form of the market's reaction.
I am not going to try to guess which way the market will react. It doesn't really matter, and I think betting on it is a fool's game. Our original two scenarios still hold, and the jobs report will not affect the strategy. Either we see a short squeeze to form the last hoorah for this countertrend rally or we see the 65 DMA on the SPX fail. The first scenario allows us to sell into emotional buying while the latter allows us to enter shorts when the market has already proven itself weak.
Silver took out $16 today, leaving a void of resistance overhead to the $19 level. Gold jumped another $13 and is flirting with breaking out of the huge basing pattern going back to early 2008. If it gets above $1000, I suspect it will hold that level during the "creep" phase of this bull cycle (see yesterday's post).
See you this weekend....