zn futures
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ES futures bears should get better entry levels
The NASDAQ futures weighed on stocks, but the broad market is marching on.
From a historical perspective, this week is not the time to be a stock market bear. As we've outlined, the market generally likes to move higher into Fed meetings and quarterly futures expiration also tends to put upward pressure on pricing. This is true, at least until the Friday morning Triple Witch. From there, things sometimes turn sour. Thus, the ES bears will likely have better entry points in the coming sessions if they are patient.
We've also heard chatter about a Bradley turn date occurring on the 20th of this month, and others are noting June 26th as a potential reversal date based on moon cycles. We don't normally pay attention to these types of things, but the fact that they coincidentally appear to be in line with the charts make them at least worth noting.
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Jobs - Dodd Frank = ES Futures Rally
A healthy jobs report, a potential Dodd-Frank peel back, and renewed talks of tax cuts propelled markets higher.
Financial futures traders loved Friday's events and they expressed that sentiment by buying into US assets. For the first time in a LONG time, the jobs report was judged by its merit as opposed to the anticipated reaction by the Federal Reserve. In other words, the markets no longer seem to be held hostage by the Fed's every move. Instead, investors are looking to speculative economic growth as the driving factor with the Fed's monetary policy as a secondary concern.
Non-farm payrolls grew by 227,000 in January but the good news was slightly dampened by sluggish wage growth. On a positive note, the unemployment rate ticked higher to 4.8%. No, that isn't a typo...a higher unemployment rate is a positive. The increase in the unemployment rate is a sign that the labor force has increased. In short, some of those who were discouraged from looking for work have found a reason to get back on the job-hunt (remember, the headline unemployment report fails to recognize those who stopped looking for a job out of frustration but are still unemployed).