From the Trading Desk

Small Gains after Wednesday’s Selling; Traders await March’s Job Report

Today’s light volume affair was uneventful as the market awaits Friday’s job report. The good news is we did not sell sellers pick up where they left off after Wednesday’s debacle. We continue to see a lack of follow-through to the downside which is good news for stock market bulls. We are not without blemishes as we do have distribution days mounting up as well as the Dow Transports and Russell 2000 below their respective 50 day moving averages. Friday’s job report will likely show healthy gains in employment for the month of March. We doubt it will be “yuge,” but at least there is some job growth. How the market will react will be anyone’s best guess. The issue now will become at the next Federal Reserve meeting will the minutes show the open market committee will begin to halting rolling over their holdings as the mature. Steady as she goes and we will see what Friday will bring.

As this commentary is being written we have bombs flying in Syria where Trump has ordered 59 missiles launched at Assad. Futures are currently lower, but nothing outrageous. They are roughly down 50bps. A little volatility is a good thing. Tomorrow morning will be an interesting morning!

Chart review time!

NASDAQ still remains the top index amongst the major stock indexes. We need to watch for distribution, but otherwise this index remains in good shape.

2017-04-06_NASDAQ_Daily

By September’s meeting the FOMC will likely have raised rates. Look for odds to adjust after the jobs report is released!

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An index to keep an eye on is the Russell 2000. The index continues to struggle and remains below its 50 day moving average.

2017-04-06_RUSSELL2K_Daily

The Shanghai is one index looking like higher prices are on its way. It has been awhile since the Shanghai has had a solid trend. A new one appears to be in place.

2017-04-06_SHANGHAI_Daily

S&P 500 looks solid, but distribution has piled up in the recent weeks. A close below the 50 day on volume would like seal its fate.

2017-04-06_SPX_Daily

Like the Russell 2000 the Dow Transports continue to lag the broader market. Is it a sign the current economy is in trouble? Higher oil prices ahead? It is anyone’s guess as to why, but the fact is the index is below its 50 day and lagging.

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Tomorrow will a fun day with plenty of news items for the market to digest. Where we will end up is anyone’s guess, but we have our action plan in place and are ready for anything.

We hope you have a great Friday and an even better weekend.

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