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Earnings Data Back on Top

The markets decided that earnings data ought to be the reason for today's trend.  Positive reports yesterday and today were the primary cause of the accelerated upmove.  All other events took a back seat. 

Option activity on the SPY seemingly validated the extreme positive sentiment as the majority of the action was on the 110 August Calls.  Underlying that expected positive activity is whether or not the action was initiated by buyers or sellers.  If Sellers initiated the move, then SPY values could move to 110, but resistance would be expected to hold and values would decrease on profit taking.

A primary indication of an improving labor market should come from Corporate America, although for a real Labor fix Small Business America needs to be in the hiring mode.  UPS stated that they are not in a hiring mode. CAT said they are hiring but cautiously and while 1/3 of new hires are in the US most new hires remain outside of the US.  DO is not in a hiring mode and in fact is decreasing its US employee base.

AMZN earnings dissappointed the after market hour crowd and share values moved lower by almost 20% at one point - expect AMZN to open with downside pressure tomorrow.  MSFT beat expectations and announced an upcoming dividend.

Summary:  Keep in mind that earnings season is in full swing and a choppy and volatile market will continue. 

Disclosure: No Positions