The action of the market of late is almost amusing. Everything is a knee jerk reaction because there is nowhere to run. The yields in treasuries are hammered and the world is being led around by debt tied to the Euro. The China issues thrown into the mix just serve to further confirm the truth which is that there are a lot more reasons to sell the Spoos then there are to buy them. As I write this the Euro is screaming but it can’t help the S&P. The jobs number was of course higher than consensus. No surprise really but the question is whether it is totally priced in. There are those who think that because of the carry trade no test means anything until we grind down and test the lows of Spring 2009. I’m not sure I would make that trade but then again I’m finding it very tough to find any major support other than by guessing. Institutional volume confirms what I think is happening in the market which is that there is no direction. The market just reacts to every little item. Big traders follow the sell-offs down on the heaviest volume and lead the deltas and then do the same on the long side when something jerks us in the other direction. But for this reason there are going to continue to be good fade opportunities as long as you wait and follow the money. Not a good time to be bold and step in front of momentum even at key levels betting on a major turn or rotation. We have been playing the scalps on the first push and then waiting for a really settle in to develop and big traders piling in before we do anything. In short, a good time to coattail as I call it. We shall see if ISM and Construction Spending have any surprises at 10, but I doubt it. The problem for the longs is that even though everyone knows spending will be down after starts being off 10%, the crappy number will still probably start an avalanche. That is the way it has been and I expect the same again today. The levels will always work for you as the auction process is pure, but you do have to change up your timing as conditions change. That is the only catch and the part that requires lots of practice. Until then you can use my instincts to smell timing trouble. LOL.