The S&P 500 has done very little during the trading session despite the fact that the jobs number was absolutely ridiculous. The fact that the market missed in the estimate by half a million jobs seems to have cause concern for about five minutes. I suspect that most of the thinking is that Wall Street does not have to worry about tightening anytime soon, as “full employment” is also one of the mandates of the Federal Reserve. As long as that is going to be the case, we are looking at cheap money at work here.
S&P 500 Video 06.09.21
That has been the mantra for the last 13 years, “the Federal Reserve will save us.” With the jobs number being as bad as it was, I think at this point a lot of people are counting on the idea of loose monetary policy as far as the eye can see, as the economic recovery continues to look very anemic. With that in mind, I think what we are looking at here is just continuation of the malaise that has been such a staple of this past week.
After all, the majority of the world’s larger traders have taken holiday this week, so a lot of volume is probably missing as well. Keep in mind that the month of September tends to be rather volatile in the beginning, as we suddenly see big players come back to work. With this, I would anticipate a lot of noisy behavior but as long as we can stay above both the uptrend line and the 50 day EMA, then it is likely that there will be plenty of buyers on dips.
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This article was originally posted on FX Empire