Daily Commentary: September 05, 2024

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Market Waiting For the Jobs Report

Posted by Pete Stolcers on September 05
www.oneoption.com

This is an important week for economic releases and they could be a catalyst.

PRE-OPEN MARKET COMMENTS THURSDAY – Tuesday the SPY sold off and it breached a minor horizontal support level at $555. It is sitting just above the 50-day MA and QQQ is resting right above the 100-day MA.

“Is bad news good news? Is bad news bad news?” I don’t know. I am going to be watching these support levels and we will either breach them or bounce off of them. The one thing I will say is that “good news is good news”. I want strong economic growth even if it means the Fed does not cut rates. This would be good for the market and it demonstrates strength on the part of the Fed. They can ease when they deem it necessary and inflation is no longer an issue so they can cut if they want to. Global economic conditions are soft and the US has been the exception for the last two years. If our economy softens, I don’t see any other “saviors”. In my opinion, this would be a very slipper slope to navigate and the market will constantly be wondering if the Fed waited too long and if the recession will be deep and prolonged.

This morning ADP came in light (99K jobs in the private sector), but Initial Claims came in fairly strong at 217K. These balanced each other out and the S&P 500 did not move after the releases. ISM Services will be released after the open (51.3 expected). A number below 50 would spark selling and a number above 52 should spark a bounce.

Don’t play Junior Analyst. Just wait for the move. If we breakdown, we want to do it fast and hard… no looking back. If we bounce we want to see nice consecutive green candles.

Support is at the 50-day MA and resistance is at $555.

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