by Danny Riley

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Jobs and Jitters: The Market’s High-Wire Act

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Our View

I’m not sure how the jobs report will play out, but after an all-week rally, I can’t see how it could go bad. I’m not saying they make up the numbers, but Powell knows President Trump wants lower rates. While the markets have gone up, it’s hard to fall in love with this rally.

Do I think the ES will make new highs? Yes, but I don’t think this is 2023 or 2024. I know how January goes, the year typically goes, but there are just too many variables—inflation, interest rates, all the changes going on with the new administration, geopolitical tensions, and US security at home. I’ve never seen such a massive amount of change happen so fast. Maybe I’m wrong and everything will work out, but how many ducks can you shoot before you miss?

Today will be a test for the Labor Department—they want the jobs number to come in solid. According to the Dow Jones consensus, nonfarm payrolls for January are projected to show growth of 169,000, down from 256,000 in December but nearly in line with the three-month average. The unemployment rate is expected to remain at 4.1%, according to the Dow Jones consensus for the report which will be out this morning at 8:30 a.m. ET.

I have a rule about the jobs report: If the ES gaps higher on oversized Globex volume, you sell the gap. If the ES gaps lower, you’re supposed to be a buyer—I prefer the latter. Inflation has been pretty much steady for the last several months, with a slight uptick. Anything under 150,000 jobs might not play out well. The markets are looking for stability, and today’s jobs number could be a positive sign.

Our Lean

I’m still bullish, but I think there could be some surprises today. I’m also a tad concerned about the next few weeks. I don’t believe the ES can keep going straight up.

Our lean: Like I said above, I prefer to buy a gap-down open. But if the ES opens 15 to 20 points higher on the open, the sellers may show up.

MiM and Daily Recap

The Globex session kicked off at 6090.25, where the ES briefly dipped to 6086.25 before buyers stepped in. The overnight rally carried price up to a 6106.25 high, and Globex eventually settled at 6098.75—an 8.50‐point gain (0.14%) on 168,307 contracts.

The market began with a quick run up to 6106.25 at 09:24, registered as an early highest high (HH). That momentum soon faded, pulling price back to 6093.00 at 09:36. Buyers returned by 09:45, lifting the ES to 6105.00 (just shy of the prior swing high) before heavier selling set in and drove the market to a lowest low (LL) of 6085.25 at 10:48. Renewed buying interest emerged, pushing the ES to 6101.00 by 11:24, though it remained below the morning peak.

Following some midday back-and-forth, the ES briefly reached 6100.50 at 12:21, slipped to 6092.50 at 12:30, then tested 6100.00 again at 13:06. Unable to break higher, the market drifted down to 6093.50 at 14:00 and finally tumbled to 6070.00 at 14:33, a fresh intraday low. From there, a wave of late-day buying carried the ES to its eventual highest high of 6108.50 at 15:54. Into the final minutes of trade, prices eased to 6107 at the bell closing near the high of the day and capping a session marked by multiple swings between highs and lows.
The post cash close put in a wild 3 minute candle that traded from 6107.75 down to 6075.25.

In the short Cleanup session, price opened at 6107.25, reached a modest 6107.75 top, then reversed to 6075.25 before settling 6094.25, off 13 points (–0.21%) from its open. Overall, including Globex and RTH, the ES ended at 6094.25—up 4.00 points (0.07%) from the prior day’s open—on total volume of 1,111,648.

Meanwhile, the MIM (Market on Close Imbalance) read bullish at 15:50 ET, showing $Pct around 80% and #Pct at 71.4%. That strong lean toward buys gradually tapered off into the bell, winding down near 63.5% by 16:00 ET. Despite the late‐day fade in imbalance, the ES held onto modest gains into the final settlement, capping off a session that showed resilience despite some notable intraday swings.

In the end, the ES and NQ closed higher, while the YM and RTY both closed 0.46% lower. The ES closed up 0.13%, and the NQ gained 0.38%.

In terms of the ES’s overall trade, volume was low again at 1.13 million contracts traded. The yield on the 10-year note ended at 4.437%, up from 4.421% on Wednesday but down from about 4.8% in mid-January. Gold prices fell 0.5% from Wednesday’s record close, ending at $2,856 per ounce.

How to read the MIM

Technical Edge

Fair Values for February 7, 2025

SP: 22.82
NQ: 93.36
Dow: 110.78

Daily Breadth Data 📊

NYSE Breadth: 47.1% Upside Volume
Nasdaq Breadth: 59.3% Upside Volume
Total Breadth: 57.7% Upside Volume
NYSE Advance/Decline: 49.0% Advance
Nasdaq Advance/Decline: 47.2% Advance
Total Advance/Decline: 47.9% Advance
NYSE New Highs/New Lows: 108 / 38
Nasdaq New Highs/New Lows: 175 / 97
NYSE TRIN: 1.06
Nasdaq TRIN: 0.59

Weekly Breadth Data 📈

NYSE Breadth: 47.9% Upside Volume
Nasdaq Breadth: 51.4% Upside Volume
Total Breadth: 50.0% Upside Volume
NYSE Advance/Decline: 47.4% Advance
Nasdaq Advance/Decline: 40.7% Advance
Total Advance/Decline: 43.3% Advance
NYSE New Highs/New Lows: 253 / 74
Nasdaq New Highs/New Lows: 334 / 342
NYSE TRIN: 1.05
Nasdaq TRIN: 0.88

Guest Posts:

SpotGamma Founders Note:

Get instant access to our partners’ real-time market data and insights not available anywhere else. Here is last night’s Founder’s note getting you ready for today’s market and explaining the constraints in yesterday’s market. – MrTopStep

Futures are flat ahead of todays 8:30AM ET NFP.

AMZN -7% after earnings.

Resistance: 6,100, 6,010, 6,120
Support: 6,040, 6,020, 6,000

There are two key zones on the board today: 6,100 and 6,000. We’d anticipate an SPX move to one of those levels today.

The 0DTE straddle is $40, or 65 bps (ref 6,085). We’ve been railing against the low IV’s in the environment, given the large market swings. In this case, the $40 handle price seems to line up with big resistance (6,100-6,120) and support (6,040).

To the upside, 6,100 is a clean resistance line not only because its a big areas of longer dated OI, but because it looks like our friend Capital Condor has struck a 0DTE position at 6,110. We also note SPY 610 (SPX 6,120) as a major call gamma line.

To the downside, the put spread of this rather small ~1-2k contract condor is around 6,040, which is first support. Under there, 6k is major support. <6k we are risk off, with an initial target level of 5,950.

The full condor is:

6,105 x 6,110 call spread
6,040 x 6,035 put spread

As you can see on TRACE there are other non-Capital positions around these same levels. The first order impact of this is that these are now stronger support & resistance lines.

The second thing is that it seems the condor is again reversed, meaning Captain appears to be long the condor, vs seemingly being short almost every trade before. This long/short debate sparked a bit of controversy in the options space yesterday, as the Captain seemed to also go long the condor on Wednesday.

Get instant access to our partners real-time market data and insights not available anywhere else. Here is last night Founder’s note getting you ready for today’s market and explaining the constraints in yesterday’s market. – MrTopStep

Good Reads:

DLC Risk Grains & Livestock Report

Trading Room News:

Polaris Trading Group Summary – Thursday, February 6, 2025

Morning Session:

The day started with PTGDavid setting the Line in the Sand (LIS) at 6085 for ES and 21750 for NQ, outlining bullish and bearish scenarios.
Early market action saw two-way consolidation above the prior high, signaling a lack of strong directional movement initially.
A CL (Crude Oil) OPR Short was executed, and all targets were hit, marking a solid early win.

Mid-Morning to Lunch:

The NQ Open Range Long trade began scaling, followed by an NQ Breakout Failure (BF) leading to a push higher.
ES saw OPR Short with Target 1 filled, but price continued to respect the key 6085 LIS level, reinforcing its importance.
David emphasized precision in PTG Levels, jokingly calling it “Voodoo” as the market adhered closely to the expected levels.
Lunch period was mostly quiet, with David standing aside due to a lack of clear edge.

Afternoon Session:

Around 2:30 PM, sellers pushed below PH 6092 while price remained above LIS 6085. Shortly after, the Bear Scenario triggered as ES broke below 6085, with lower targets being fulfilled.
A notable technical break below PH 6092 was observed, though no major trade triggers (TTBs) appeared.
The market exhibited “coiling” behavior, leading to a sharp move—a reminder of the risks of trading within tight ranges.
A beautiful reversal occurred from the Central Pivot/Prior High Volume Node, which was clearly visible on the 30-minute chart.

Closing Action & MOC (Market on Close):

The late-day sell-off was quickly recovered, reaffirming bullish strength.
A significant MOC Buy of $3.3 Billion triggered a sharp move higher, described as a “classic M&M Move”—flushing weak longs, trapping shorts, then reversing up.
Amazon (AMZN) earnings released after the close, with slightly weaker-than-expected AWS sales, leading to cautious positioning into the end of the day.

Key Takeaways & Lessons Learned:

Precision Pays Off – The LIS levels (6085 for ES) held up incredibly well, reinforcing their importance in trade execution.
Stay Flexible – Early consolidation meant waiting for a breakout rather than forcing trades.
Lunch Hour = Stand Aside – No edge during this time, best practice is patience.
Coiling Leads to Breakouts – Recognizing tight ranges helps anticipate larger moves.
MOC Tricks – Weak hands were shaken out before a strong move higher, highlighting the need to understand liquidity flows.

A strong day for PTG precision trading, with well-executed trades and solid market reads. Looking ahead to Freaky Friday! 🚀

DTG Room Preview – Friday, February 7, 2025

Mixed Market Close: Stock indices ended Thursday mixed as traders processed earnings and Trump’s policy shifts. Dow Jones fell 0.3%, S&P 500 rose 0.3%, and Nasdaq gained 0.5%. The market has fully erased Monday’s tariff-related drop.
AI Driving Earnings Focus: Investor sentiment remains centered on AI demand, with earnings and forecasts being assessed through this lens.
Trump’s Economic Moves: Treasury Secretary Scott Bessent signaled Trump prefers lowering borrowing costs (via 10-year Treasury yields) over cutting interest rates. Trump also met with Republican lawmakers on tax cuts, surprisingly including the elimination of the carried interest tax loophole—potentially doubling some hedge fund managers’ tax rates.
Key Economic Data Today: The January Jobs Report (8:30 AM ET) is in focus, guiding expectations for future Fed rate cuts. Also on the docket: UoM Consumer Sentiment & Inflation Expectations (10:00 AM ET), Consumer Credit (3:00 PM ET), and Fed speakers Bowman (9:25 AM ET) and Kugler (12:00 PM ET).
Amazon Earnings Hit: Amazon (AMZN) beat revenue expectations but gave weak Q1 guidance, sending shares down over 4% after-hours. The company struggles with AI-driven cloud computing capacity constraints, planning a $100 billion investment in AI-related infrastructure but facing supply chain and power challenges.
Market Volatility & Technicals: Volatility eased ahead of Amazon earnings and the Jobs Report. ES futures remain range-bound, with the 50-day MA at 6054.50 acting as loose support. Key trendline resistance levels: 6130/28s, 6260/65s, 6456/61s. Key support levels: 5915/20s, 5705/00s.
No Clear Whale Bias: Overnight large trader volume was too light to indicate significant directional bias.

Stay tuned for the Jobs Report reaction—any bullish surprise could break ES’s short-term downtrend!

ES – Week over Week

The long-term bull/bear line now sits at 5984.75, and that remains the key pivot separating a broader bullish posture from a more defensive, bearish stance. As long as ES continues to trade above this threshold, buyers hold the upper hand; a sustained move beneath it would hand momentum to the sellers.

In the pre-market session, ES is hovering around 6105.25. The first upside level to watch is 6108. If price can clear that level, the next resistance comes in at 6115.75, followed by a more substantial target at 6153 which would be the upper range target for the day. A strong continuation above 6153 could open the door toward even higher prints later in the session.

On the downside, initial support is near 6099.25 which is the intraday pivot bull/bear line. A break below that could invite sellers to test 6090.25, with 6078.25 and 6070 lurking just underneath. If weakness persists, look for follow-through toward 6065 and 6041. Additional downside targets include 6003.50 and 5994. Any deeper move places 5984.75 squarely in focus. A sustained break beneath the bull/bear line at 5984.75 would mark a decisive shift in control back to the bears.

NQ – Week over Week

The bull/bear line for the NQ sits at 22,080.50, serving as the key pivot that separates a broader bullish tone from a more defensive stance. As long as price remains below this level, sellers hold the upper hand; a decisive break above would shift momentum to the bulls.

In the pre‐market session, NQ is trading near 21,863.75. The first upside hurdle is 21,868, followed closely by potential resistance around 21,905–21,920. Above that, 22,029 comes into view as a more significant upside target. Should price push through 22,029 and hold, it could open the door toward 22,080.50 and beyond. That would be a bullish day and align the NQ trend with the ES.

On the downside, if NQ slips below the intraday pivot near 21,840, it could invite sellers to target 21,706 next. Deeper support levels include 21,644.25 and 21,563.50. A sustained break beneath 21,320.75 would add to the bearish tone, with further downside risk extending toward 21,195.75. Any failure to hold above 21,995.75 as the long‐term bull/bear line would mark a shift in control back to the sellers.