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USA500: Confirmed closing price reversal top

European shares closed sharply higher yesterday after the ECB unleashed an arsenal of measures to protect the fragile recovery of the Eurozone, including cutting all three interest rates to new record lows and announcing a bond buying program.

Today on the economic calendar we have from the U.S we have the Non-Farm Payrolls that expected to show a steady grow 209K to 225K and a slight drop in the unemployment rate to 6.1%. The shocker would be if that unemployment rate fell even lower than 6.1 percent, highlighting an improving labor market while the Fed is still far away from moving to raise rates. The same discussion could be sparked if the 200K plus number expected proves to be a much larger number.

Yesterday, the Usa500 confirmed the previous day’s closing price reversal top, but because of the low volume ahead of Friday’s U.S. Non-Farm Payrolls report, there was little follow-through to the downside. Traders could continue the potentially bearish chart pattern today, or negate the chart pattern on a trade through the top, but this will be determined when the government releases the August jobs report at 8:30 a.m. ET.

Expecting downward move to 1,985.25 on a break of below daily resistance at 1,998.5 (scenario 1).

Usa500 is a CFD written over S&P500 futures.