Today’s nervous action before the big jobs report makes me think that a blast might be possible. Of course poor job market data would trough the market of the cliff.That is for sure. The overall sentiment is pretty gloomy so the numbers don’t need to be spectacular to be able to spark a short-term rally in these kind of oversold markets.

I can’t deny the gold and the silver market looks like investors are raising some cash to be ready to buy badly beaten stocks in case of good numbers. Bonds, Gold and Silver have performed well during the hate crime against the stocks. Rotation might be the name of the game here. Nobody knows for sure except BO & Co. They already know the numbers. You can count on it.

SPY chart is not a pretty picture. This can go anywhere from here. The 500dEMA not shown in the chart has offered some recent support for the SPY. 38 % retracement line from March 2009 lows to April 2010 highs was tested and rejected today. Indicators are flashing oversold but how much it got to do with anything if the numbers are horrible tomorrow? It won’t be easy task to sell the market down from here but nothing is impossible. However, this still looks like it is preparing itself for the jump.

Money flowed out of the bonds eve of jobs report. TLT is one of the tickers I have on my active short candidate watchlist. This is far overbought. These papers are not that sweet at all. They don’t deserve this kind of royalty treatment they have got last couple of months.

GLD is trading in very strong up-trend 200d front weighted MA acting as a trend line. Looking for a buying opportunity near the support are. 

Huge sell off on SLV combined with a similar reaction on GLD and TLT indicates massive uncertainty. Cash is the king here and it is looking for a new place to go when the market opens on Friday.

Peace,

Matias