The SP500 attempted a breakout this morning which has so far failed. Closing under yesterday's low would warn us that a near term top may be developing, and closing under last week's low at 1083.74 would confirm a top. On the other hand, a reversal of this morning's selloff with a solid close above this morning's high would put the bulls firmly in control.
The ISM nonmanufacturing index came in well under the expected level this morning and also under 50, which indicates contraction. Shortly afterward, the White House put out a press release indicating we may see a rise in the unemployment rate tomorrow morning. This smacks of an attempt to manipulate the markets by either trying to minimize the impact of a worsening unemployment rate or sandbagging the bears who may be wrongly positioned if the rate comes in better than expected tomorrow morning. Either way, this type of behavior is not conducive to a bull market, no matter what our leaders believe. It only adds to uncertainty and skepticism.
Regardless of the market reaction to the unemployment data tomorrow morning, traders would do well to wait for an hour or so to let the market settle down before entering new positions or exiting existing ones.
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