Submitted by Mark Hanna
Courtesy of MarketMontage. View original post here.
It is a little difficult with seasonality to get a good gauge of the job market this time of year, plus ADP has changed its methodology in the past few months on how it measures data but whatever the case any print over 200,000 in the labor market is a positive over what has been happening most of the past few years. Expectations for this number were only 133,000. November’s data was also revised up 30K to 148,000.
As for the market it’s been a big ride the last two days. Also a lot of headfakes the past few weeks as is somewhat typical in a headline driven market. As always technical analysis is a guide, not an absolute and these pushes in an out of recent ranges typify that as news from D.C. dominates everything. In mid December after Boehner budged on tax rates we had the first move over early November highs, but that was quickly rejected. (first blue arrow) Then a week later there was a second attempt over those highs which looked like it was going to be more substantive. (second blue arrow) Of course negotiations went south and not only was there a second failure over early November highs but the index fell out of an ascending channel it has been in since mid November. (orange arrow) That was a quite bad development. Of course we also reversed that on the fiscal cliff news, and that proved to be yet another head fake of sorts. Not only is the index back in the ascending channel from mid November it is now reaching the upper end of that channel. Quite remarkable really.
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