US Payrolls are Back in Focus

U.S. Stocks Look To Extend Weekly Gains

Posted Friday, November 2, 2018 by
Shain Vernier • 1 min read

It has been a strong Friday morning on Wall Street. Both the DJIA and S&P 500 have rallied through the first hour of trade. At least for now, investors don’t appear apprehensive toward risk going into the pre-election weekend. U.S. stocks are on the bull for the fourth straight day, the longest winning streak since September.

The timing of today’s rally is a bit curious ahead of the election weekend break. Of course, nowadays a positive 100 point open in the DJIA doesn’t mean a whole lot, given the heightened levels of volatility. Odds are that we will see the positive sentiment challenged by day’s end.

U.S. Stocks Extending Weekly Gains

From a fundamental standpoint, the December E-mini DOW futures should not be on the rally. With uncertainty over the Congressional Midterms and the U.S. Unemployment Rate holding steady at 3.7%, there is reason for skittish investors to sit this one out. However, Non-Farm Payrolls came in above expectations at 250,000 for October.

December E-mini DOW Futures (YM), Daily Chart
December E-mini DOW Futures (YM), Daily Chart

Here are the two levels to watch in the December E-mini DOW until the closing bell:

  • Resistance(1): Daily SMA, 25668
  • Support(1): Bollinger MP, 25400

Overview: Technically, the December E-mini DOW has made great strides this week. Price is back above 25000 and has put in a test of the Daily SMA. Given the bearish nature of U.S. stocks during October, this is a good sign for equities bulls.

Be on the lookout for extreme volatility as we near the closing bell. Investors may be poised to reduce risk exposure as the day wears on. If this is the case, then a positive close for U.S. stock indices may hard to come by.

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About the author

Shain Vernier is our US Analyst
Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.
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