1:10pm (EST)
Remember back in high school when there were certain teachers who gave the same tests year after year? As long as the textbook stayed the same, you could usually pick up a copy of a test from last year to Ace the quiz and look like a genius. Of course, you had to be in the know and figure out who the cheaters were. Then you had to make sure you didn’t get busted.
Well, the bears appear to have all the answers today as they are punishing the test that the bulls have given them. The Dow has fallen below 10,000 and looks weaker than a faded euro bill which has dropped below $1.20.
There were a lot of know-it-all’s who were predicting today’s employment report would knock the cover off the ball but they whiffed after predicting up to 700,000 new jobs were created. We reported this morning that there were fewer jobs created in May (430,000 versus 540,000 expected on average) and we said on Wednesday a number below a “half mill” would be devastating for the bulls.
Check. Although we didn’t cheat in high school we feel like we have today as we were on point after telling you in our Weekly Wrap that we expected one last rally cry for the bulls and then the shoe would drop. There could be some kind of rebound by the bulls today but our “cliff notes” are telling us the Dow closes below 10,000 and the S&P 500 will fade 1,075.
As we head to press the Dow is getting pounded for a 237 points loss, or 2.3%, and is at 10,018 after touching a low of 9,988. The S&P 500 is down 25 points, or 2.3%, and stands at 1,077. The Nasdaq is down a Grant (50 points, or 2.2%) and was last seen going through Richmond at 2,252. (that was for you VA history buffs).
We still want to see continued selling pressure into the closing bell today which could set the stage for a nasty Monday. Folks, if we get back-to-back lower closes, today and on Monday, then it could get real ugly.
Subscribers, check the Members Area for today’s trade updates. For those of you who haven’t joined us yet, we will be back Sunday night with the Weekly Wrap.
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