If this morning's knee jerk reaction was not so predictable it would be laughable. Last week (and last afternoon!) when claims hit 500,000 I wrote there was a bright side. Once bad news accelerates, when it falls back to a level that is still awful but less bad we can buy the market in glee while cheering second derivative improvement. Even though the number we are buying as we yell whew! not so bad is recessionary. My only surprise is the rally sputtered out...
Here is the Wall Street game.
4 weeks ago - jobless claims 470K. That's not good.
3 weeks ago - jobless claims 480k. Getting worse.
2 weeks ago - jobless claims 480k. Uh oh.
Last week - jobless claims 500k. Yikes!
This week - jobless claims 473k. Great news!
I am using jobless claims but you can put any economic data series and you see the same laughable behavior. The normal perma bulls are out saying the coast is clear.
S&P 1057 is one of the key levels and we remain stuck on it so far today after the initial spurt of buying on good news. Putting on an index trade that lasts more than a day is near impossible with the herky jerky reactions to all the economic data we have coming our way.