The bears rejected Wednesday’s exuberant rally in a punishing whipsaw sending indexes back for another test of 2022 market lows.  So while hopes were high for a relief rally, traders and investors have to worry about holding market lows as support!   Analysts expect growth in the pending Employment Situation report, which, if true, could help inspire the bulls to defend.  However, a miss could make for another challenging day of selling.  Whatever occurs, expect price action to remain challenging as we slide into the uncertainty of the weekend.

Asia market traded mixed but mostly lower overnight, with the Hang Seng leading the way, down 3.81% at the close.  This morning, European markets are primarily bearish, a day after the BOE raised interest rates.   Ahead of earnings and the Employment Situation report, U.S. futures point to modest declines at the open pensive that jobs growth holds strong as we head into the weekend.

Economic Calendar

Earnings Calendar

We have about 120 companies listed on the Friday earnings calendar, with a sizeable unconfirmed number.  Notable reports include ADDYY, AXL, ABR, CI, SSP, FLR, IMGN, FWONK, NRG, RUTH, SPB, VST & WPRT.

News & Technicals’

Bitcoin cratered on Thursday as a significant stock sell-off in the U.S. spooked the cryptocurrency market.  As a result, around $129 billion of value was wiped off the cryptocurrency market in 24 hours as of 4:03 a.m.  ET, according to data from CoinMarketCap.  The selling of cryptocurrency was sparked by a painful day on Wall Street where the Dow Jones Industrial Average lost more than 1,000 points on Thursday, marking its worst single-day drop since 2020.  Customers reserving a Lucid Air in June or later will pay 10% to 12% more for their vehicles.  Lucid said it would honor current pricing for all existing reservations and any new reservations made before May.  Lucid maintained its previous full-year production guidance.  The eurozone faces concurrent economic shocks from the war in Ukraine, a surge in food and energy prices exacerbated by the conflict, and a supply shock from China’s zero-Covid policy.  Stefan Hartung, CEO of German engineering and technology giant Bosch, told CNBC that the company sees “a big recession in the making.”  Russian President Vladimir Putin could look to declare some victory in — or an even bigger assault on — Ukraine around May 9.  May 9 is “Victory Day” in Russia, marking the anniversary of the then-Soviet Union’s defeat of Nazi Germany in World War II.  A number of geopolitical analysts believe Putin will use the occasion to make a major announcement relating to the Ukraine war.  According to state media, Chinese President Xi Jinping headed a meeting of top leaders on Thursday that emphasized the country should stick to its “dynamic zero-Covid” policy and warned that economic consequences would follow if it didn’t.  Treasury yields rise slightly in early Friday trading, with the 10-year ticking up to 3.07% and the 30-year trading at 3.15%.

After an exuberant Wednesday rally, the reality of the current market conditions got the bears back to work, rejecting overhead resistance levels with a punishing whipsaw.  Yesterday everyone was hoping the relief rally could follow through for a second day, but now investors have to hope the recent market lows hold as support!  Unfortunately, the uncertainty is not just a U.S. market problem with significant concerns in Japan, China, Europe, Ukraine & Russian economies, to name a few.  This morning will turn our attention to the Employment Situation Report; the consensus expects to see job growth!  Fingers crossed, analysts are right because another disappointing report could create another day of selling.  No matter what happens, I expect price action to remain very challenging as we move toward the uncertainty of the weekend.

Trade Wisely,

Doug