BIG MORNING

The big employments number is due out at 8:30 AM and all eyes are focused on it as it will no doubt move the markets and based on the charts its going to move the markets in a big way. Why? Because the markets have traded in a very tight range since last Thursday's rip and the markets are due for a period of higher volatility as volatility is mean reverting.

Which way? Well we are right at the downwardly sloping 50 day SMA and a bit above the 200 day SMA support level (126.2) so a test back down would not be surprising.

The Volatility indexes are also quite oversold at levels equivalent to where they broke out from in the middle of May.

Stochastics and MACD, as noted on the chart above, are also at overbought levels so the preponderance of evidence says lower.