The economy added 165,000 jobs in October, against roughly 65,000 expected. Unemployment came in at 4.1%, wages rose 0.4% on the month, and the prior two months were revised up by a combined 84,000. In most regimes, that’s a green-open number.
This morning the bond market read it as a reason to price a December rate hike. The 10-year jumped to about 4.88% on the print, S&P futures pared their gains, and Nasdaq futures are holding around +1.4% as I write this before the open. Whether that bounce holds is one question. Whether it means anything is another.
Remember what Thursday did on the way in.
SPY fell 4.4% to $733, its worst day since April 2025, and closed just above the red 200-day SMA near $730. That’s the level everyone will be watching today. Not because it’s magic, but because it’s the first real structural test since the slide started.
QQQ dropped 6.5% Thursday and is down about 13% over the past month. The Nasdaq Composite is officially in correction territory. None of that is unusual after the run we’ve had. What matters is where the damage actually landed.
AMD fell more than 17% in the session and is down about 29% in five days. On Wednesday I wrote that strong earnings were no reason to catch the AMD knife. I’d rather not be proven right at that speed, but the point stands: good fundamentals don’t soften a liquidation.
MU lost 17.5% Thursday and is in the same boat, and IREN is down more than 30% on the week. Meanwhile Apple and Microsoft are roughly flat on the month. The index can bounce on mega-cap strength while the names that actually broke keep bleeding, which is why what you own matters more than where SPY sits.
One detail worth noting: SPY, QQQ, AMD, and MU all closed below the lower rail of their weekly expected moves. That boundary is what the options market priced as the week’s likely range. Closing through it means Thursday wasn’t a normal down day. It was a move the market hadn’t priced.
Now connect the two days. The names that crashed are the market’s longest-duration assets, businesses priced on earnings years out. Higher discount rates hit exactly those valuations hardest. A hot jobs report pushing the 10-year toward 4.9% is a headwind aimed squarely at the group that needs a bounce most.
Thursday’s selling had its own logic before rates entered the picture. Funds were already de-risking crowded 2026 winners ahead of year-end, per Nomura, and retail traders were net sellers of about $358M, the most since 2020, per Vanda. There’s also reported regulatory and permitting risk hanging over AI data-center buildouts since the change in congressional control. Rates didn’t start this fire, but they can feed it.
So treat any Friday bounce for what it is: a bounce. The technical crowd is split between “confirmed top” and “buying opportunity,” and neither is established. Calling bottoms feels heroic and costs nothing. Holding them is the expensive part.
Here’s the condition I’m actually watching. Can the semis and high-beta leaders stop making new lows for several sessions with the 10-year near 4.9%, and can SPY hold its 200-day near $730? If the leaders stabilize under that yield pressure, a bounce has a foundation. If they don’t, the index level is decoration.
The systems handled this the way they’re built to. Payday Friday, my weekly stock-options spread engine, closed its ABT and HD spreads at target on Wednesday, before the break. SigmaPirate’s SPY bull call spread hit its target the same day and went flat. Blitzen’s COST spread hit target Thursday for about +189% even as the tape broke. Defined risk, defined exits, no opinion about the jobs number required.
SigmaScanner ran its weekly cycle this morning and flagged a handful of bull call and bull put candidates. Whether this regime is friendly to new bullish spreads is exactly the question above. The structures exist, and the tape gets a vote.
If you want this kind of read (structure, expected move, regime, defined-risk exits) turning into live signals instead of a Friday-morning essay, SPY Alpha covers equities and index options. check it out here
Cheers,
Michael
