It took a while but the obvious "sell the news" trade on today's better-than-expected jobs news finally kicked. It needed a little kick-start from news of Fitch's debt downgrades of Italy and Spain, which took the air out of the momentum buying.
If the trading pattern that I discussed in my opening post holds, then we should see some fairly fast downside follow-through. The pattern of this market has been multiple positive days in a row that causes folks to think that the worst is over, followed by a reversal that gains traction on negative headline news.
Some bulls are arguing that the jobs report this morning really is a game-changer, while the bears are saying, "Yeah, sure. Haven't we seen this show before"?
Since I am unable to find many individual charts that I like, I'm not inclined to do much buying anyway -- I'm giving the sellers some room here. A little downside action would actually improve many charts that went from oversold to overbought in the blink of an eye.
If you have been having a hard time with this trading environment, you are not alone. I hear endless complaints lately from traders who have been stymied by this market but are unable to do much other than some quick directional trades. Keep on plugging away. One thing I absolutely guarantee about the market is that things will eventually change.