US indices erase post NFP losses

3:53 PM February 3, 2023

Major Wall Street indexes reversed early losses to trade higher on Friday afternoon as investors digested the latest better than expected  US  payrolls report and ISM services PMI data. Investors seem to bet that high employment could soften the landing, while inflation will continue to move lower and potential recession could be less severe than expected or could be avoided as the economy continues to be resilient. Traders now see the Fed raising the fed funds rate to 5%-5.25% before pausing, above 5% expected before the payrolls release. 

US30 again bounced off key support at 33720 pts which coincides with 61.8% Fibonacci retracement of the downward wave launched in January 2022 and 50 SMA (green line). As long as price sits above, another upward impulse may be launched towards recent highs at 35000 pts. On the other hand, if sellers manage to regain control, then the nearest support to watch is located at 32620 pts. Source: xStation5

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