Friday 2 May 2014

Awaiting the 1900s

The market looks set for the sp'1900s, whether tomorrow, or more likely...early next week. The underlying price pressure remains to the upside, and equity bears have been entirely absent since the Monday spike floor of 1850.


sp'weekly8b


Summary

A somewhat tiresome day, so I'll keep this relatively short.

We continue to have a third consecutive green candle on the weekly charts, and without question, the broader trend favours the bulls. The sp'1895/1905 zone looks viable as early as tomorrow.


Looking ahead

Tomorrow will be all about the jobs data - although there is also factory orders.

Market consensus is for 215k net gains, with a slightly lower headline rate of 6.6%. However, I'd be surprised if the market fell, unless the gains are less than 175k.

*next sig' QE-pomo is not until next Monday
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Holding heavy long overnight

I held to the plan, and picked up the drilling stocks - DO, RIG, and SDRL, that I had dropped late Wednesday. I certainly didn't catch the lows, but my re-entry levels were in my target zone, so I can't complain.

All things considered, equity bulls should do okay tomorrow. A break below the recent 1850 low looks very unlikely in the immediate term. Indeed, I am expecting a break to new historic highs in the Dow/Sp/Trans, whether tomorrow..or early next week, makes little difference to me.

Goodnight from London