The S&P 500 has fallen between short-term support at 1,040 and the 1,020 zone. Some analysts are expecting a drop toward the 1,000 level. The depth of the correction will probably depend on the non-farm payrolls (jobs) report due out Friday morning.
The ADP employment report was worse than expected and the weekly initial jobless claims were worse than expected. Plus the Goldman Sachs analyst downgraded their view on the jobs report tomorrow. Expectations are growing that instead of -200,000 jobs for September that it will be closer to -250,000.
Economists are expecting the unemployment rate to tick up from 9.7% to 9.8%. Yet if the jobs number comes in around -250,000 or better I suspect we could see a widespread market bounce. With so much hanging on the jobs report tomorrow I'm not adding new positions at this time. We still have a few candidates with triggers to buy the dip of the correction deepens.