- Moving the market
The markets kicked off the day with a bang, rallying right out of the gate after this morning’s jobs report came in stronger than expected—quite the turnaround from yesterday’s weak ADP numbers.
Nonfarm payrolls rose by 147,000, beating forecasts of 110,000. On top of that, May’s numbers were revised upward to 144,000. The unemployment rate also dipped to 4.1%, defying expectations of a rise to 4.3%.
That solid labor data sent bond yields jumping and cooled hopes for a rate cut anytime soon. Right now, futures traders are putting the odds at about 93% that the Fed will keep rates steady at their next meeting.
Adding to the mix, the approval of the so-called “Big Beautiful Bill,” along with strong factory orders and upbeat service sector data, is painting a picture of an economy that’s still expanding. Translation? Rate cuts are likely off the table for now.
Still, traders seemed to like what they saw. The major indexes posted strong gains for this holiday-shortened week, with the Nasdaq and S&P 500 both closing at record highs—helped along by a weeklong short squeeze.
Bond yields surged, the dollar slipped a bit, and gold managed to close higher for the week despite a pullback today. Precious metals overall are still riding a wave of bullish sentiment.
Bitcoin made a run at its all-time high but couldn’t quite stick the landing, fading into the close.
So, with seasonals pointing to more upside, the big question is: Will stocks keep climbing as we head deeper into summer?
Happy 4th of July!
2. Current domestic “Buy” Cycle (effective 5/20/2025); International “Buy” Cycle (effective 5/8/25)
Our domestic bullish cycle that began on November 21, 2023, concluded on April 3, 2025, following a market downturn triggered by President Trump’s tariff policy announcement.
This development caused significant declines across major indexes and broader market indices. However, markets subsequently rebounded, culminating in a new domestic “Buy” signal taking effect May 20, 2025.
Concurrently, our International Trend Tracking Index (TTI) experienced parallel volatility. On April 4, 2025, it breached critical thresholds, prompting a “Sell” recommendation. This position reversed as global markets recovered, with the International TTI regaining sufficient momentum to issue a new “Buy” signal effective May 8, 2025.
3. Trend Tracking Indexes (TTIs)
After yesterday’s disappointing ADP jobs report, traders were caught off guard when today’s employment data came in stronger than expected.
That surprise sparked a wave of optimism, sending the major indexes higher to wrap up the shortened trading week with solid gains.
Our TTIs also moved up nicely, widening the gap between current prices and their trend lines. Interestingly, the international TTI continues to show more resilience than the domestic one.
This is how we closed 07/03/2025:
Domestic TTI: +5.49% above its M/A (prior close +4.98%)—Buy signal effective 5/20/25.
International TTI: +9.69% above its M/A (prior close +9.35%)—Buy signal effective 5/8/25.
All linked charts above are courtesy of Bloomberg via ZeroHedge.
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