I think that there are way too many people who are betting that tomorrows employment data will be horrible and they are shorting the stock indicies or loading up on puts. Currently they are expecting 1,500,000 people filing for unemployment but in California alone I think over 1 million people already filed. When you add the 49 other states its definately going to be a miss.
It's basically already a fact that BLS unemployment data is going to be horrible. The only question is to what extent it is already priced in.
Now here is the issue. Every Tom, Dick, and Harry knows the numbers are going to be brutal. And they are turning into huge bears expecting the SP500 and US30 to drop to new 54 week lows. What usually happens when the herd is following one direction? Usually the opposite happens.
Any COT data to back that up?
S&P 500 futures just rallied 18% from the lows. The daily gain on Tuesday almost set a new record. Intraday analyst sentiment may have turned bearish but I don't think sentiment is anywhere near as bearish as you make it out to be. Not to mention, sentiment is just like an oscillator. During strong downtrends, the market can sustain fear for long periods of time.
The market is probably due for more relief rallying in the next couple weeks but it isn't going to sustain this week's rate of gains by any means. The market already rallied all week on stimulus deal rumors. You think now that the news is in, the market is going to keep rallying? To where?
