We wanted to wait to go to press to see how the market held up going into the close. Despite a terrible unemployment report, the bulls have been able to hold down key support levels and are trying to hold onto their gains for the week.
Futures were pointing towards a nasty open after the Department of Labor reported non-farm payrolls rose by only 18,000 which was oh, about 87,000 short of the expected increase of 105,000 jobs. The unemployment rate rose from 9.1% last month to 9.2% versus expectations of 9.1%. Looking deeper into the numbers, hourly earnings were flat, versus expectations for a pop of 0.2%.
Elsewhere, May Wholesale Inventories increased 1.8% versus the 0.7% forecast that had penciled in by the suit-and-ties. In addition to being higher than expected, this result was also significantly up from the increase seen in April.
Next week is the start of 2Q earnings and Alcoa (AA, $16.26, down $0.23) will unofficially kick off the season on Monday after the market closes. If earnings and guidance come in better-than-expected from most companies then we could resume the current rally. Today’s losses were yesterday’s gains and the bulls have done well limiting the damage.
The Dow is currently down 98 points to 12,620 while the S&P is off 13 points to 1,340. The Nasdaq is lower by 23 points to 2,849.
The week has been good to us as our subscribers were able to close out a Freeport McMoRan (FCX, $55.94, down $0.55) call option trade for a 300% win. Since late April we have CLOSED 14 out of 16 winning trades despite a choppy market. Recent wins have included 110% on LNKD, 133% on RLD, 357% on RIMM, and 50% on KKD and KFT.
We will be back Sunday night with the Weekly Wrap and hopefully, a new video for those you who have purchased our options trading course, How to Trade Options on Momentum Stocks. Until then, have a great weekend!