Awaiting tomorrow's big Employment Number (circa 1635)

The market's eyes all face toward tomorrow's Employment number. There is a tangible shift in the way in which market is looking at economic data.  Today we saw weekly employment claims come in on the low end of the range (fewer claims) and stocks quickly rallied. At 10am, when the Non-manufacturing ISM number disappointed, the equities went negative and gold got a small pop. The momentum is certainly to the downside here, but tomorrows number can change everything.

As for gold, open interest is increasing everyday (currently at paltry levels) which could signal new longs coming into the market.While I anticipated that we might hold the 1650 level and build a base higher, we have seen weakness in the past two days. Still, I believe the trend will remain higher. With decent earnings the stock market has seemed to lose its steam. A disappointing jobs number tomorrow could really cause things to tumble. If the recent inverse correlation between equities and gold continues, then we can expect a bad number to be the beginning of a gold bull charge....and you might just start to hear the phrase "safe haven" a whole lot more.

Recently (Fed announcement for example) large sell orders come in right before economic data to push the market. If the number is a big miss, a tremendous opportunity to buy gold on the dip might present itself (operating on the assumption that gold picks up a safety bid). While 1625.5 was support last Wednesday, I am hearing 1610 as the first level of support, and 1580-1590 as the next level one could buy it.