Jobs Friday on June 6th

USD: Jun '25 is Up at 98.775.  

Energies: Jul '25 Crude is Up at 63.05.

Financials: The Sep '25 30 Year T-Bond is Higher by 15 ticks and trading at 114.00.

Indices: The Jun '25 S&P 500 emini ES contract is 12 ticks Higher and trading at 5984.00.

Gold: The Aug'25 Gold contract is trading Up at 3419.00.

Initial conclusion

This is not a correlated market.  The USD is Up and Crude is Up which is not normal, and the 30 Year T-Bond is trading Higher.  The Financials should always correlate with the US dollar such that if the dollar is Higher, then the bonds should follow and vice-versa. The S&P is Higher and Crude is trading Higher which is not correlated. Gold is trading Higher which is not correlated with the US dollar trading Up.  I tend to believe that Gold has an inverse relationship with the US Dollar as when the US Dollar is down, Gold tends to rise in value and vice-versa. Think of it as a seesaw, when one is up the other should be down. I point this out to you to make you aware that when we don't have a correlated market, it means something is wrong. As traders you need to be aware of this and proceed with your eyes wide open. All of Asia traded Higher.  All of Europe is trading Higher as well.

Possible challenges to traders

• Challenger Job Cuts y/y is out at 7:30 AM EST.  This is Major.
• Unemployment Claims is out at 8:30 AM EST.    This is Major.
• Revised Nonfarm Productivity q/q is out at 8:30 AM EST.  This is not Major.
• Revised Unit Labor Costs q/q is out at 8:30 AM EST.  This is not Major.
• Trade Balance is out at 8:30 AM EST.  This is Major.
• Natural Gas Storage is out at 10:30 AM EST.  This is Major.
• FOMC Member Kugler Speaks at 12 noon EST.  This is Major.
• FOMC Members Harker and Schmidt Speak at 1:30 PM EST.  This is Major.

Traders, please note that we've changed the Bond instrument from the 10 Year (ZN) to the 2 Year (ZT). They work exactly the same.

We've elected to switch gears a bit and show correlation between the 2-year Treasury notes (ZT) and the S&P futures contract.  The YM contract is the Dow Jones Industrial Average, and the purpose is to show reverse correlation between the two instruments.  Remember it's likened to a seesaw, when up goes up the other should go down and vice versa.

Yesterday the ZT climbed Higher at around 8:15 AM EST with Unemployment Claims pending.  The Dow slide Lower at the same time.  Look at the charts below and you'll see a pattern for both assets. The Dow moved Lower at 8:15 AM EST and the ZT climbed Higher at around the same time.  These charts represent the newest version of Bar Charts, and I've changed the timeframe to a 15-minute chart to display better.  This represented a Long opportunity on the 2-year note, as a trader you could have netted about 20 plus ticks per contract on this trade.   Each tick is worth $6.25.  Please note: the front month for ZT is now Sep '25 and the Dow is still Jun '25.  I've changed the format to filled Candlesticks (not hollow) such that it may be more apparent and visible.

Charts courtesy of barcharts

ZT -Sep 25 - 6/04/25

Dow - Jun 2025- 6/04/25

Bias

Yesterday we gave the markets a Neutral or Mixed bias, and the markets didn't disappoint as the Dow dropped 10 points but the S&P and Nasdaq both closed Higher on the session. Today we aren't dealing with a correlated market and our bias is Neutral.

Could this change? Of Course.  Remember anything can happen in a volatile market.

Commentary

I know, I know, I know D-Day was June 6 not June 5th but this year we have Jobs Friday on June 6th and I wanted to dedicate that issue solely to jobs.  I pay homage to my father and uncles who landed in France on that day.  Without folks like that who knows what the world would be today?