Of course we have a jobs number Friday morning which is sure to be nasty. The estimate is for 540k jobs lost and 7.5 unemployment rate. I think the market is already pricing in a bad number higher than this. I would say as long as we don't top 650k then the market can rally. Sounds crazy but just watch.
Its all about the 850 resistance we have been fighting and if we blow through it, then I think we could have one hell of a short squeeze rally Friday. The pivot is at 836. We are trading 841 currently overnight and are probably going to gap in one direction or the other after the jobs number premarket. If we open up above the pivot point then I want to go long expecting another retest of 850. This would be the third test of 850 in three days. As traders we just love the law of three's. Usually when a level is tested three times then it breaks through. Not always but usually. So if get over 850 then I think we have a green light target to 870 where we have a gap to fill from last week.
If we do sell off under the pivot then my bias is bearish. 850 is a big level in my mind and if we cannot close over it for the week then we may have some problems. Pivot is crucial to me on Friday to see if the longs hold into the weekend.