(MENAFN- Daily Forex) The s&p 500 did very little during the trading session on Thursday, which is both good and bad. Quite frankly, I was a bit surprised that the lighter-than-inflation Core PCE numbers didn't have this market taken off to the outside, but then again, we do have the Friday jobs numbers coming out, and that obviously will have an influence on how the market behaves. With that being the case, I think it's probably only a matter of time before we see some type of resolution to where we are right now.
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I think the jobs number needs to come in at either 200,000 or lighter in order to make this market go higher during the day on Friday because quite frankly we are now back into the attitude of“bad news is good news” on Wall Street. The Santa Claus rally could be getting ready to kick off, which is the end of the year markup by fund managers to trying to explain to clients what they own and the fact that they own all of the“correct things.” Whether or not that takes off is completely unknown at this point, but it is a phenomenon that is quite often seen at the end of the year.Be Cautious
Underneath, we have the 200-day ema near the 4023 level, which should offer a certain amount of support. In this environment, I would anticipate that we probably have more than a better shot of seeing buyers in that area, as well as 3950 or so. On the other hand, if the jobs number comes in extraordinarily high, that could nip this rally right in the butt. I still think this is somewhat of a bear market rally, but the seasonality aspect is something that a lot of people will blindly follow.
With this, I think it's probably only a matter of time before we see some type of bigger move, and between now and the end of the year I'm becoming more and more convinced it's probably going to be follow-through to the upside. That being said, you need to be cautious on Friday as the jobs number will have a major psychological influence on where we go next. 4200 is a very realistic target over the next couple of weeks, especially as Jerome Powell has shown a bit of hesitation in his last remarks.
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