Goldilocks Jobs Report Attracts Buyers. The Rally Will Stall Today. Wait For Momentum

I did get a few reviews - Thank You. I was hoping for more. I put a great deal of time into this free research report each day and your comments keep me motivated. Please post a review on INVESTIMONIALS We saw a light profit taking this week, but each market decline instantly bounced back. That price action suggested a strong bid and I tried to discourage you from being short in yesterday's comments ("Don't short this move"). This morning the S&P 500 is up 17 points. Some analysts blamed strong economic releases for the weakness. ADP, GDP, ISM manufacturing, ISM services and initial jobless claims all exceeded estimates and tapering fears resurfaced. I don’t fall into this camp. The Fed is not going to taper until Janet Yellen takes office and the debt ceiling is extended. The market needs strong economic growth if it is going to move higher. This morning, the unemployment report showed that 200,000 new jobs were created and this was a Goldilocks number. Some analysts were looking for 240,000 new jobs. The report was not too hot and not too cold. We did not get the pullback I was hoping for. As you can see, that would have presented an excellent buying opportunity. This is the last round of major economic news. This news will have to carry us through the rest of the year. I don't like to chase stocks and this rally seems a little overextended. Once we settled down, I will buy a few calls. That probably will not happen today. Wait to see if this rally holds. After a 25% rally this year, we could see some profit taking on big spikes. By the middle of next week I expect to see tight trading ranges and a slightly bullish bias. The market should be able to grind back to $182, but I don't think it will get much higher in 2013. Avoid the high-fliers. They will be vulnerable to profit taking. Your best bet will be stocks that are in an uptrend and that have consolidated for a few weeks. These horizontal breakouts tend to be sustained and the stocks are not overextended. If you have some nice candidates in mind, you can nibble today. You won't have the market working against you the rest of the year. I don't think the market will follow through Monday so I will wait until next week. As an option trader, I need momentum and I like to have the market and the stock working in my favor. The market has been pulling back from the highs. A reversal today would catch many people off guard, but the probability is less than 20%. I would love to see it. That would really flush speculators out and it would set up a great buy. . .

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