I like Bollinger Bands as a quick visual indicator.  I don't put much stock in them beyond that, but it gives you an idea of where we are in the grand scheme of things.  Right now we are clearly at the bottom of the range.  Typically, my feeling is that there will be some mean reversion, but not necessarily a change in trend.  So my thought is that the jobs number would have to really, really awful for us to have a big down day today.  If we were at the top of the range, I'd feel that the job number would have to be really, really swell for us to continue any significant upward movement.

 

What all of this means to me is that I have put some small bets out during yesterday's big move down that there will be some retracement.  If we continue to go further away from the "channel" of the bands, I'll increase the size of my bet.  This is a potentially dangerous move because the further we deviate or the less mean reversion, the more I'm hurting.  Clearly, not a move for everyone.  However, the long term trend of the market is up, so I feel if I'm diversified, the risk is mitigated a bit.

 

Have a great weekend.