January 5, 2023

Markets:

Stock futures wavered Thursday as investors looked beyond the hawkishness of the Federal Reserve’s meeting minutes and toward labor data coming later this week.

The moves follow a choppy trading session as traders pored over a mixed bag of economic data.

November’s Job Openings and Labor Turnover, or JOLTS, report showed the job market remained strong, bolstering concerns that the Fed could continue raising interest rates as long as there remained a hot market for workers. But the ISM manufacturing index showed the sector was contracting after 30 months of expansion, which investors saw as a positive indicator that previous rate hikes had the intended impact of cooling the economy.

Meanwhile, the minutes from the Fed’s December meeting showed the central bank remained committed to higher interest rates for “some time.”

Investors will watch Thursday for more data on jobs, the trade deficit and business activity. Fed speakers Raphael Bostic and James Bullard are also both slated to speak.

On Friday, investors will review the December jobs report for updated data on employment and hourly wages. Since the report could have a big impact on the Fed’s next moves, it has the potential to impact the market. Investors don’t want to see big gains in wage growth, which could signal higher inflation.

Portfolio:

We enter the new session holding set-ups in FLYW, AAL, and ZIM. Market remains in a choppy pattern and within 3800 – 3900 on the S&P. An argument could be made its consolidating before exploding higher. I can see that but, really think we trade down one more time to at least 3500 on the s&P and potential break below towards 3300 before we rally hard. But we will always respect the trend and what the market is providing. If we see a break and hold above 3900, then we support it and go with it as well and welcome all the opportunities that would bring. Just keep an open mind and do not get sold one way or another as to which way this market will break. The trend lines remain; above 3900 to the upside and a break below 3800 for the downside. This range has to break soon as traders digest the newest data points. Be ready today for further updates and a new trade alert could possibly trigger. Queue is triggering early on today which is good to see. Let's have a great session.