Today’s stock market session was a positive one as small caps leading the way. Volume did not meet expectations, but given the big moves over the past few sessions it is not a surprise. It was nice to see the market reverse yesterday’s losses after the ECB announcement. Crude oil even jumped back over the $50 mark. Fears over a catastrophic event have subsided and this market is in position to push higher. The market will now focus on Friday’s job report. A solid session today with the Russell 2000 index leading the way higher. Unless we reverse and break through the previous lows this market is poised to continue to push higher.
Tomorrow’s job report will certainly give traders something to chew on. However, like most economic reports it will be quickly forgotten. We have a market on the verge of breaking free from the recent range it has been in. Whether or not we see volume accompany the move from the consolidation is a different story. Until we can break free we will not have conviction, but we will be positioned for a breakout.
Sentiment shifted away from a bullish slant in the AAII, but the NAAIM exposure index remained bullish. The AAII Bulls dropped to 35% while bears jumped back above 30% to 32%. NAAIM Exposure index remained bullish finishing the week at 88. Once again, like last week there was not a single manager with short exposure. This week’s sentiment, while still bullish is not near extremes.
During the after-hours session there were some nice moves. For one, TWTR which moved more than one percent in the regular session jumped more than 9% in the after-hours session. TWTR still remains well below its high. The overhead resistance will likely hold back the stock for some time. On the downside P dropped more than 19%. It proves earnings typically are a crap shoot.
Tomorrow’s job report will give traders something to overtrade on. While last year Jobs reports were important due to QE they have lost their luster as of late. Due to falling commodity prices the Fed is now in a tough spot with raising rates. If the job market continues to improve will the central bank raise rates? While others spend hours upon hours to come up with an answer we will simply follow our number indicator: price.
Have a great weekend!
