S&P 500 (SPY) Report – 01/06/23

Good morning traders!

The S&P 500 ($SPY) is trading above yesterday’s close. Let’s get into it…

Today, December’s employment data was released and employers added 223,000 jobs, a minor slowdown in hiring from the previous figure of 256,000 reported in November. This is still above the 200,000 forecasted and could possibly foreshadow a deeper pullback and the recession many economists expect in 2023. The Labor Department also reported that the unemployment rate decreased from 3.7% to 3.5%.  While there are some signs of progress amid the Federal Reserve’s interest rate hike decision to tame inflation, we believe this data won’t change the Fed’s view of the world that much.

In the news, Citi recently downgraded U.S. stocks to underweight. “Recession reality approaches as Fed hawkishness manifests in signs of slowing activity. We expect a weaker first half, and a stronger second half,” says the Citi team. “We assume recession concerns and Fed hawkishness will peak during the first half of 2023, with markets anticipating recovery in the second half of 2023.”

Potential Intraday Resistance Levels:
01/04/23 High of Day: $385.88

Potential Intraday Support Levels:
50D SMA (4hr): $381.93

Note: Moving averages are reported from the previous trading session and will change during the next trading session. 

Friday Economic Events:
Employment Report 8:30am ET – High Volatility Expected
ISM Non-Mfg PMI 10:00am ET – High Volatility Expected
Factory Orders 10:00am ET
Baker Hughes Rig Count 1:00pm ET

Fed Speaker Scheduled:
Raphael Bostic 11:15am ET
Tom Barkin 12:15pm ET
Raphael Bostic 2:30pm ET

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