Nasdaq Composite: Tension after the monthly employment report

(News Bulletin 247) – Frozen at 2:29 p.m., in bright red at 2:31 p.m…. the pre-opening data on Nasdaq100 underwent a very clear correction. The employment figures are there. Far from being bad if we stick to his photograph – the job market remains very dynamic – the analysis of its tensions augurs an additional frown from J. Powell.

Regarding the main lessons of this NFP (No Farm Payrolls), the dynamics of wage increases did not take off (+0.3% monthly in September), but the increase in job creations in the private sector (excluding the agricultural sector) was surprisingly fast, at +263,000. The unemployment rate – this was not in the Fed’s plans either – contracted sharply to 3.5% of the active population, against a consensus of 3.7%. The change in total non-farm payroll employment for July was revised up by 11,000 from +526,000 to +537,000, and the change for August remained at +315,000. Employment in July and August combined was 11,000 higher than previously reported.

While at the beginning of the week, the ISM manufacturing index, in “prices paid” components, had hinted at a little flexibility (at least momentarily) on the part of the Fed, this employment report revives fears of monetary policy still very muscular for the months to come.

KEY GRAPHIC ELEMENTS

The small lateral transition that we foresee will have lasted three sessions, in volumes in free fall. A significant increase in this level of participation on the day’s falling session would give credence to the bearish scenario, even though the failure against a resistance zone (the 20-day moving average) is surgically observed.

FORECAST

Considering the key chart factors we have mentioned, our opinion is negative on the Nasdaq Composite index in the short term.

This bearish scenario is valid as long as the Nasdaq Composite index is trading below the resistance at 11460.00 points.

CHART IN DAILY DATA

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