This morning, September nonfarm payrolls soared previous expectations, 254,000 vs. 132,500. Including to the bullishness was the upward revision to August nonfarm payrolls because the prior studying of 142,000 was boosted to 159,000. That is stable information, particularly in an atmosphere the place the Fed is dedicated to decreasing rates of interest. We did see a tick greater in common hourly earnings for each September and August, nonetheless, however initially that’s being ignored by way of market response. Let’s examine how we shut at this time.
Rapid Reactions
Bonds offered off exhausting as yields surged. Look no additional than the 10-year treasury yield ($TNX), which is greater by 12 foundation factors, eventually test, to three.97%. I see overhead yield resistance from 4.00% to 4.20%. Remaining beneath that stage retains the TNX in a downtrend – a minimum of in my view:
We nonetheless have some room to the upside within the TNX, however as we transfer greater and better, do not the chances start to show extra in favor of one other leg decrease?
Subsequent is the U.S. Greenback Index ($USD). Many market contributors have been anxious concerning the long-term path of the greenback because the buck had been downtrending since double-topping in April/Might. This is the 1-year USD chart:
After the USD moved simply beneath assist from the late-December 2023 low, it has shortly rallied, and at this time cleared what seems to be channel line resistance. This might possible reignite the long-term uptrend within the USD:
We all know {that a} rising greenback usually impacts commodities in a adverse method, so what ought to we anticipate in This autumn and into 2025?
Lastly, the preliminary spike within the TNX has actually spooked homebuilder ($DJUSHB, -3.03%) shares, which have fallen moderately harshly at this time, regardless of the general market rally. Personally, I feel that is most likely a bit overblown, however the group does present a adverse divergence on its day by day chart, so maybe a little bit extra promoting would set the group up for an extended commerce:
When a chart exhibits an uptrend, pullbacks to deliver the RSI stage all the way down to the 40-50 vary usually characterize good shopping for alternatives. Will this one?
MarketVision This autumn Outlook Occasion
EarningsBeats.com is internet hosting our 1st MarketVision mini-series occasion, “This autumn Outlook” on Saturday, October fifth at 10:00am ET. I will be offering my outlook for This autumn, reviewing areas like shares, bonds, commodities, the greenback, sentiment, seasonality, market rotation, and many others. It is open to ALL members of EarningsBeats.com, together with FREE 30-day trial members. Beforehand, MarketVision-related occasions have required an annual membership to EarningsBeats.com in an effort to attend. Nonetheless, we’re providing the occasion to FREE 30-day trials for this inaugural occasion. You possibly can CLICK HERE for extra info and to register for this occasion!
You possibly can at all times register later this weekend and obtain a recording of the occasion.
See you tomorrow morning!
Tom
Tom Bowley is the Chief Market Strategist of EarningsBeats.com, an organization offering a analysis and academic platform for each funding professionals and particular person buyers. Tom writes a complete Day by day Market Report (DMR), offering steering to EB.com members on daily basis that the inventory market is open. Tom has contributed technical experience right here at StockCharts.com since 2006 and has a basic background in public accounting as effectively, mixing a singular talent set to method the U.S. inventory market.
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