I was all ready for the expected BLS report, expected to show new jobs in the range of 150,000, with some expectations around 175,000. After the small move yesterday in the McClellan Indicator, which normally signals a big move the next day, I was ready to offer some short ideas this afternoon that would capture the last EW #5 move up, and set up for a top. I was also watching the pre-market prices, all trading higher overnight, waiting for the BLS report. Now, after the report, the first Call is looking for a flat open.
BLS reports actual new jobs at 36,000, non-seasonally adjusted U-6 up to 17.3% from 16.6%, and labor force participation at 64.2%, the lowest percentage since 1984. But the good news is that unemployment is down to 9.0%. But wait! there is more news down in paragraph 4 and 5.
The labor force has dropped from 153,690 to 153,186, but the numerator (you know, the number of unemployed people) dropped from 15 million to 13.9 million. IN TWO MONTHS! You have to read the fine print to understand that the decline in the number of unemployed is that those unemployed longer than 99 months are no longer considered part of the labor force. See how easy it is to get a better headline number for unemployment?
The opening prints are mostly flat to down small in all the major indexes. It will be 10:30 before we get an idea how the market is likely to trade today. Oil is up .87 at 91.41, Gold down at 1353.2, and Silver is up .27 at 29.0. The Euro continues to correct, trading at 1.358 and the Dollar continues the rally at 77.94. I am getting concerned for the bond market...... the 10 year Note is down another 1/4 at 3.583% and the Long Bond id down nearly 1/2 at 4.693%.. After what looked like an attempt to find a bottom, for the past week, prices have been trading at and breaking trend support lines. It is beginning to look like the Note is headed for 4% and the long Bond headed for 5%. I can't imagine that kind of action can be good for the equities market. Or the growing inflation expectation.
I am watching today for an opportunity to place levered short trades and will post a Trade Alert if or when that occurs.
Best To Your Trading!
Bill
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