Today started out with a mix of economic reports before the trading session started, that generally indicated an economy the is weakening even further. The odd thing is that everyone seemed complacent with the numbers. Financial news networks, analysts, and bloggers seemed unaffected, almost numbed into indifference. That is until we got further into the session. 

First up was the ADP Jobs Report that estimated 79,000 jobs lost in June, nearly four times the consensus and the biggest lost in 6 years. The most disturbing thing about the report, was the breadth of the losses, hitting sectors across the board. ADP also revised May job numbers, subtracting 25,000 additional lost jobs on top of the 40,000 originally reported.

I had expressed concern in a post on a Financial Board this morning, that these numbers were a real tear on the economy. But the report was shrugged off by respondents to the post, who marginalized it pointing to Factory Orders as “looking pretty good.” But many analysts confirm my suspicion, such as Boris Schlossberg, a senior currency analyst at DailyFX.com who said, “The ADP numbers have clearly put pressure on the dollar.”

Then the Commerce Department reported Factory Orders, which came in line with expectations, climbing 0.5%. The report indicated the US companies are cutting back on spending, but growing demand overseas is basically keeping American factories afloat. For people looking for any crumb of positive news, this was a veil uplift, and stocks began to rise. In the Wilderness Investor Group, we were more cautious, where some members held a light short position in AAPL from the day before, or remained all cash. Our general consensus was extreme froth, so stand clear until it subsides.

The first half of the trading session started out as many had expected. It looked like we were going to get the bounce in response the severely oversold conditions in all indices, and in all time frames. But then we got the Oil double whammy, first from the EIA Petroleum Status Report mid morning. The report showed a bigger than expected drop in crude oil reserves. This news put a spark under speculators, as they shot up Oil to $142 a barrel, which sent a shock wave through the system.

It was like a slap in the face to traders, saying “wake up, you were sleep walking!” They came to their collective senses and realized that a long holiday weekend was upon them, and oil was spiking for the second day in a row. They certainly aren’t going on vacation with liquidity problems on their minds. Besides, yesterday the spike started a rotation out of commodities, and today’s spike continued that rotation, hitting agriculture, steel, and coal pretty hard. But then at 2 o’clock, big money apparently said, “let’s pack it up and start the July 4th cookouts and fireworks early.” Because after that, buyers simply dried up and virtually every corner of the market went into free fall. No market or sector was spared.

Fortunately for members of Zach’s Wilderness Investor Group, we were all over the buyer defection, and because we were sitting with AAPL short positions or cash, we were well equipped. Leaders in the group directed members with proper entry points, and we road AAPL right into the close ending with huge gains. It was a great testament to the talent, patience and discipline of our members.

Speaking of the Wilderness Investor Group, if you want to learn more about trading AAPL and the markets, and tap into some of the most talented traders around, then you should join our group. It’s completely free! Click here to learn more.