The
ADP jobs data was abysmal today since it showed a gain of only 39,000 jobs from
April to May. Analysts had predicted
175,000 jobs.
The
House of Representatives played games with the National Debt limit yesterday;
Republicans voted down the hike before today’s open of the market.
The
ADP report shouldn’t be all that surprising – growth has slowed by a number of
measures – so I think a lot of people got concerned about the Political action
in the House.
Pick
your poison…a little fear…some bad economic data, and today is what you get.
Technically,
I am most concerned that the move down broke the trend line going back to last
September. It also now looks like the down-trend
from the top (1364 on 29 April) is back in play. Today’s big down move sets the bottom of the trend
so we may get some bounce tomorrow, but it is not encouraging to see this kind
of action.
If
we continue down we’ll see a Sell signal from our numerical model in a couple
of days, if that long. Quite frequently
there is some buying after this kind of move and we could see some more up days
ahead. As always, we’ll have to wait and
see.
SUMMARY
OF NTSM INDICATORS:
As
of today’s close, our 4-areas of market analysis present the following picture:
SENTIMENT: Neutral.
Sentiment is down to 51% Bulls as of today’s close.
PRICE: Neutral. Today’s big move down sent
the price indicator down, but it is not a sell yet.
VOLUME:
Neutral. I said last week that Volume has been more down than up and after
today it is worse.
VIX:
Neutral. VIX was up 18% today – not a
good sign.
I
sold all my trading positions this morning because yesterday’s big up move
followed by a big move down was confusing.
I didn’t know at the time that today would be a HUGE down day. I made a little on the ETF, but I lost a
little on the Rydex fund (couldn’t get out until 1045AM) so I broke even
overall on the trade. Considering how we
wound up for the day, I am happy to do that well. I needed to reduce risk even though,
statistically, we should bounce up from here a couple of %.
