MarketSmith powers the charts in this video.
After some back-and-forth choppy price action for most of last week, most stocks finally had a high-volume range expansion on Friday. Can this be the beginning of a year-end rally or it will be just another oversold bounce that will fold quickly? We will know soon enough.
It all depends on interest rates and the US dollar. If they continue to pull back, this stock rally can continue. The job numbers crushed estimates on Friday (336k vs 170k estimates). The algos sold the initial number in the pre-market session. It was the final flush. The indexes started to recover shortly before the market opened and didn’t look back. The Nasdaq Composite and QQQ gained 1.6% of high volume, led by cybersecurity, software, and semis. Small caps were up 1% on decent volume too.
Later in the day became clear that the payroll report was not as strong as the headline numbers suggest. Only 23k jobs were full-time. The rest were part-time and self-employment gigs. What matters is the market reaction and the existence of setups to buy. Unlike other follow-through days in the past couple of months, this time there are some decent setups to choose from. Some examples – CRWD, PDD, ZS, PANW, VRT, NTNTX, XPO, META, INTU, GWRE, ANET, SNPS, MOD, SPOT, etc.
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