Bull & Bear Weekly Pivots in Sight

Amazon earnings, NFP, UofMICH data

Ok so we touched upon Amazon in yesterday’s pod and here are the numbers, Amazon beat their EPS estimates by $0.36 hitting $1.86 expecting $1.50. However AWS revenue was below estimates, as net sales were $28.79bn expecting $28.82bn and operating profit fell from 38.1% to 36.9% but once again it was the weaker forward guidance that caught analyst an investors eyes and thus the stock was hit for this. Amazon is -4.13% on the day trading around $229, we suspect longer term buyers to step in at $225 but real support is below around the $216 and $201 areas. We highlighted the $235/$225put spread yesterday and looks as if that trade is providing some value add today:

As far as non farm payrolls the headline print was +143k expecting +169k but the unemployment rate was 4.0% exp. 4.1%. We aren’t confident in this report and have not been for quite some time, as the monthly revisions continue to move the initial print by a large amount. So to take this for anything other than an estimate is lunacy, what we can do is look at the markets reaction both for bonds and stocks.

The US Govt 10Y jumped about 7bp off the number and all the recent bond longs took some profits here post number, but the move isn’t enough to change the bullish sentiments for rates going lower in the future:

As far as the equity markets, the SP500 futures didn’t really move that much post NFP but really moved after the UMich consumer sentiment number which dumped from 71.1 to 67.8 and 1-yr inflation forward expectations jumped to 4.3% from 3.3%…another number we highly doubt, but more a product of “tariff” induced expected inflation which is to be determined at best. Anyway here is the chart of the SP500 futures:

On the weekly our target pivot is the same and 6042.50 is still that bull/bear line for us, for now the sellers seem to be very consistent on any attempt to break above 6110: