“Saying we’re in a slow recovery, not a recession, is like saying we don’t have any unemployed-we just have a lot of people who are really, really late for work.”

With payrolls numbers being a mixed assortment of ‘poor’, stockmarkets reversed yesterday’s summer madness; if they hold these levels into the close it will add more weight to the bearish technical picture.

The headline payroll number at -467,000 was 100,000 worse than consensus, though several of the big banks had upped their forecasts to north of 400,000 after yesterday’s ADP shocker. But in true payrolls style the unemployment rate didn’t rise by as much as feared. Remember that this apparent contradiction stems from the numbers coming from different sources.

So how’ve I traded today?
“Poorly, but with the best of intentions,” is the honest appraisal. I played myself in, selling FTSE last night at 4318; not the best level, but that’s because I wanted to see a confirmed failure to re-take the 21-day moving average.

This morning I missed the opportunity to flip the trade down at 4275 and had to settle for closing out at 4304 ahead of the payrolls data. Hindsight is shrieking at me that if I’d held my position over lunchtime I’d be well in the money now. But I didn’t; that would have been equivalent to tossing a coin with my trading capital and I’d rather lose an opportunity than my money.

That bit was fine, but I was slow to react after the numbers when I waited to see if there would be any follow through from yesterday’s fun and games. There wasn’t but by then I’d decided that I’d missed the initial move and would be better off waiting for a new signal.

The good news is that, barring a late change of heart, the charts have become more bearish. Firstly, the failure to close above the downward-sloping 21-day MAV shows a lack of real demand, allowing the technicals to dominate. Secondly, today’s red candle has engulfed yesterday’s green candle (another bearish sign used by chartists). And thirdly, although the index closed above 4300 last night, it felt uncomfortable at that level and failed to hold the gains today.

The signs are even more marked on the Dax, which failed yet again at its 50-day moving average and has reversed yesterday’s gains with the fury of a woman scorned. I’m looking to re-sell both indices, but reckon a dose of patience might reward me with better entry levels. Certainly the FTSE is too close to previous support to warrant a short position now.

I added a small short bet in Barclays to my long-standing short in Lloyds shares. I didn’t catch the top, but used the spike up on affirmation of its credit rating to sell at 290.5p

I didn’t go near the forex market today and probably won’t tomorrow with the US closed.

Happy Trading