Bulls Cave in Mid-Day

Earnings continue to trickle in to the market, but most of Earnings Season is now a known commodity to traders, so traders are fairly neutral on the overall reports this morning. One report that they are focused on this morning is the ADP Jobs Report. The report hasn't hit the wires yet, so I don't have a market reaction as of this first posting.

Unless the report is either catastrophically bad, or much better than expected, which will push or kill the current bounce, then I speculate that we are in for a "soft" upswing in the market. In other words, I'm not looking for a huge push. Perhaps we get a nice follow-through in to the 850 - 860 area on the SPX, and then the market watches for the next two rounds of employment reports.

Here is a chart of the SPX:
(click on image to enlarge)

The SPX formed a Morning Star Reversal yesterday, which has an eventual target of 875 if the market can get above the first target at 858. Again, we will need to see some fairly "calming" jobs data this morning, and Thursday - Friday morning to reach those targets, but for now, the swing is up. We shall see.....

6:35 am MT: Pre-market Update: The ADP Report came out better than expected (although still a horrible number). The pre-market futures immediately jumped, and now we are likely to see a gap up this morning and a run to the 858 area on the SPX during the day. The upswing in the market is still on the table for another day, so I'm playing it that way until I see the next signal.

11:50 am MT: Intra-day Update: The Bulls are caving in after a nice early day upswing. At this point, the damage is severe enough that the market is unlikely to come back to the old highs from the morning. This goes right to the heart of why I take this one intra-day swing at a time. We will probably still get an intra-day bounce, but now today looks like a consolidation day at best, and a selling day at worst.

4:45 pm MT: I just did a Marketcast, which will probably get posted in the next hour or so. It will be on the phone hold later. It's a little bit of a longer Marketcast, but if you're interested, it's there.