After all of the doomsday prophets on Friday, one had to wonder what might happen today. One day doesn't make or break a trend, but today's market action was encouraging. SPX traded as high as $2083 before settling back at $2079 for a gain of $8. RUT followed suit with a gain of $6, closing at $1224. Volatility was basically unchanged with the VIX closing down a tenth of a point to 15.1%. Trading volume was down from Friday's high numbers, with two billion shares of the S&P 500 stocks trading; the 50 dma is 2.2B. Trading volume dropped 16% on the NYSE and decreased 11% on NASDAQ.

Friday's sell-off was sufficient to push IBD to move from "Confirmed Uptrend" to "Uptrend Under Pressure". Watch their web site this evening to see if that moves to "Market in Correction" - probably not after today's small gains.

There was no economic news today, but I looked up the non-farm payroll data for the past twelve months. The conventional wisdom for Friday's sell-off was something to the effect that such an "unusually good" jobs report would cause the Feds to increase interest rates in June rather than September. When I look at the data, it is pretty choppy and I fail to see February's 295k as "unusually strong". We had 304k back in May of last year and 423k in November. The only thing positive about the February number is that it saved us from drawing a downward trend line from November through February (December was 329k and January reported 239k). I'm not convinced this is the definitive "last word" for Yellen's assessment of the economy. For now, remaining bullish appears to be the safer alternative. Whenever interest rates begin to rise, it will slow the economy, and that is precisely why I think the FOMC will be slow to take that step when we are still observing mixed data.