Happy Friday fellow traders, and for those of you who stayed long despite last week's (and earlier this week's) pullback, it was a very happy Friday for sure. Stocks roared for a second day in a row, pulling the market back into the black for the week. I can't say to you that I think everything is great again and the rally is back on track, but I can tell you we've got some clarity on the market's next most-likely "tells". Let's look at that in a moment. First, let's slice and dice this morning's employment report, just you have the whole story rather than just the half of the story the media told you. 'Goldilocks' Unemployment Numbers I mentioned to you when I was wrapping up yesterday's newsletter how May's employment data from the Department of Labor was going to make or break the market. But, it was going to be a tricky interpretation. If it showed too much strength, the Fed may be motivated enough to end its QE program earlier than first assumed. If it was too weak, then it may suggest the economy was entirely too weak to merit investing in, QE or not. The key would be numbers that show some economic strength, but not so much strength that Ben Bernanke closes the spigots off right away. Well ladies and gents, we got that not-too-hot-and-not-too-cold number. As you probably heard, the DOL says 175,000 new nonfarm jobs were created last month, topping the outlook of 159,000 new payrolls. That's good. However, the unemployment rate crept up, from 7.5% to 7.6%. Looks like the Federal Reserve still has a reason to keep stimulating the economy by keeping interest rates low. Now, that's the data you probably already know. What about the numbers you didn't hear? Truth be told, the employment market is decent. The number of people who are actually working is going up, reaching 143.9 million people last month. That's the highest number of American workers with jobs that we've seen since 2008 (when the number was on the way down). So how's the unemployment rate still inching upward if more people are working? Because the labor force is also expanding, at a slightly brisker pace. The discouraging fact of the matter is, the participation rate (the percent of U.S. residents that are working) is stagnant at 58.6%. The number of people who consider themselves part of the labor force is 155.6 million... right at record levels. But, the percentage of people in the entire populous who are in the labor force is also still at multi-year lows. The number of people who aren't technically counted as part of the labor force but still want/need a job now stands at 6.7 million, which somewhat taints the fact that the number of unemployed people has gradually fallen to 11.7 million (from the 2009 peak of 15.4 million). The point is, it's not like the employment picture is great. It's not like it's bad either. It's just good enough to support some corporate growth, yet tepid enough to keep the Fed in stimulus mode. And, that's all the market wanted to hear today. Right on Cue I hope none of us was surprised about the way everything went down (proverbially) today. The bulls were more than willing to pick up where they left off on Thursday, but that momentum was capped right where we would have expected it to be capped. Some traders will chalk it up to the Friday/pre-weekend blahs, and I suppose there's some of that. But, I think it was the near-brush the S&P 500 had with its 20-day moving average line that prompted the rally's stall. Of course, there's little to complain about with a 1.3%, one-day romp. We've discussed it before - the 20-day line may have been a floor in late April, but now that the S&P 500 has fallen under it, the 20-day line became a floor. We got confirmation of that reality today when the market managed to rally until it hit the 20-day line. From here, the smart thing to do is just wait. The market's trapped in a range, and could stay trapped for a while. The upper edge of that range is, of course, the 20-day moving average line at 1646. The lower end of that range is the mess of technical support all around 1608. That's where the 50-day line, the lower 20-day Bollinger band, and the low-close for this week are all at. Clearly there's something about that line in the sand the bulls are willing to defend. I know it's not the most riveting of opinions ... "sit tight." But, I've learned to many times before that trying to make the market do something it's just not willing to do at the time is a recipe for heartache and stress. We'll get a trade-worthy opportunity soon enough. Just for the record though, yeah, the big swing from the low on Thursday to today's high (a 2.8% swing) is the kind of rapid move that invites the sellers to dig back in and lock in profits while they can. To give credit where it's due, John Monroe over at the SmallCap Network Elite Opportunity said it best in this afternoon's SCN EO newsletter: "I want to reiterate today unless we see some sort of exceptional opportunity with any individual companies out there, we're going to remain patient until we believe these markets are definitely going much higher. As a general rule of thumb, there's no sense in adding bullish individual company ideas in a downward trending market, which is what we still have on a short-term basis right now, even with yesterday and today's rally....If you're not interested in index trading the ETF's right now, just be patient on the individual company ideas but I will say it's usually a good idea to take what the markets are willing to give you." Spot on. The SmallCap Network Elite Opportunity does a lot of things well, but one of the things they do best is keeping a level head when it's needed the most. If you've not taken your no-obligation two-week test drive, I recommend you do. If nothing else, it's a lot of fun to watch these guys make good trading sense out of difficult situations. Here's how. Or, copy and paste the following link in your browser: http://www.smallcapnetwork.com/?vmpd_ckstr[click_track]=SCN+Newsletter&vmpd_ckstr_redirect=/pages/SCNEO/v1/ Next Week Should be a fairly mild week next week, in terms of news. But, a couple of items are pretty juicy. There's only one major FDA decision in the lineup. Tentatively on the 14th (next Friday), the Food and Drug Administration will make a call on ChemoSat. If you're not familiar, ChemoSat is the device/approach Delcath Systems (DCTH) came up with to wash a cancer-infected organ or area of the body with a cancer-fighting drug. The company's just asking for marketing approval to treat liver cancer right now, but if it works out, other areas of the body could be targeted by the ChemoSat technology soon enough. Anyway, Delcath is a highly-followed name, and ChemoSat has kept a lot of traders on the hook for a while. I'd be surprised if Friday's news - whatever the decision - didn't push DCTH shares around. There are no major earnings announcements for next week. The only earning news on the way is Wednesday's reports from H&R Block (HRB) and PVH Corp. (PVH), both of which will post results after the market closes. I'm not terribly interested in either one, but if you are, then there ya' go. I see a handful of economic items worth watching - Thursday's retail sales, and Friday's industrial productivity (and capacity utilization). Economists aren't looking for much in terms of retail sales, which would be the second month in a row that consumer spending was tepid. As for capacity utilization and industrial productivity, both have been broadly on the rise since the latter part of last year, but faltered a little bit last month. One month doesn't make a trend, but two months sure could start one. There's not a lot of room for error here, so we'll be watching. That's next week though - we've got a weekend to worry about in the meantime. Everybody have a good one. Oh, in the meantime, if you haven't taken a chance to check out the SmallCap Network Elite Opportunity, you might want to right now. They just locked down a 7% win in a short-term trade, and are up almost that same amount on a position that caught the counter-swing of that first swing. That's nearly 14% worth of gains in about a week. Not bad. I'm telling you, these guys have just been nailing it recently with their short-term calls, and more important, they've been successfully trading those outlooks. If the recent market volatility is making you nuts, don't let it make you crazy - let it make you some money. The SCN EO can show you how. Check it out. Or, copy and paste the following link in your browser: http://www.smallcapnetwork.com/?vmpd_ckstr[click_track]=SCN+Newsletter&vmpd_ckstr_redirect=/pages/SCNEO/v1/