ChartSmarter Friday Game Plan 10/2/15

Markets were firmly higher in the premarket session and those gains wilted and benchmarks which were at one point lower, the Nasdaq by 1.3% at sessions lows, did reverse somewhat to eke out fractional gains. Heading into Friday the Nasdaq is off 1.6% for the week and the S&P 500 by .6%. Both have reversed nicely intraweek and if these gains can hold tomorrow, it was be construed positively. Of course tomorrow is the jobs report and a strong number could bring some certainty to the markets. Sure when the Fed looks at data to determine as to when to raise interest rates it looks more at inflation and wage growth, etc., but a firm showing tomorrow would make the clarity that much stronger. Now a quarter point rise is most likely baked in but it could have other benign effects for the indexes. A move by the Fed could entice potential home buyers to accelerate purchases for fear of further hikes down the road. That stimulation could lead to a more vibrant economy. And worries about negative showings on markets into rate rises are overblown, as it is the pace and frequency which has a impact. However this would be one of the first hikes into a slowdown (Brazil, Russia and Canada in recession) so stay tuned. Regarding tomorrow bulls would like to see some weakness heading into the open and a subsequent capitulation day. Some leaders are holding their own and they are the ones which will usually be the sharpest out of the gate when the market resumes its uptrend. Below is retailer LB and how it was presented in our Wednesday 9/9 Game Plan. It is a prime example of names retesting breakout points to determine if they are valid. LB did just that on Tuesday almost precisely touching the 88.53 double bottom pivot and then rebounded.