10:10 am EDT: We’re always weary of a NFP rally because there is usually one good number and one or more bad number, and it is always subject to different interpretations.  With 20/20 hindsight, if we were to reverse today, it would be all too easy for CNBC et al to report that the markets headed higher on the headline number, but reversed once investors digested the other bad numbers.  In reality it would be because large players were able to hit stops pre-open in an illiquid environment, then use the first part of the day to sell into the margin calls.  This is basically what happened in reverse when this rally started on March 6.

As we write, the day is shaping up to be just this scenario, and the market has breached yesterday’s settlement and has hit the Globex daily pivot area of 936.75 identified in the morning report.  We could rally here, but watch the 50% retracement off the pre-open highs.  If it is sold off, shorts are very much in control.

Gold down sharply, USD up sharply, long term yields new highs but have reversed down.

Locals in the S&P pit were selling to paper on the open.