The bears struck after the big spike up on the ISM report. The action slowly stepped lower all day. While we are less overbought, I do not get the sense of panic in today’s profit taking. A number of economists from Goldman Sachs to Societe General, reduced their predictions for the jobs number today, so expectations are going to be low. Without further bad news, a Jobs related gap down may be an interesting buying opportunity into Labor Day seasonality and Obama’s big jobs initiative next week. Will traders view bad news as agood thing because it will also give usmore cover for QE3? After that it may set up a sell the news reaction as we still have little clarity out of Europe until the bail out vote Wednesday next week. And Congress comes back to work at the same time, do we want more budget drama late next week?
