The S&P 500 Index Futures (CME: ES) had a mixed response to the US Jobs Report on Friday, which revealed both positive and concerning aspects. While the economy added more jobs than expected in August, the unexpected rise in the unemployment rate dampened sentiment. The 187k jobs added in August from a revised 157k in July and against the market’s expectations of 170k left the index 0.2% higher on Friday. 

Energy and materials sectors led the gainers, while consumer staples and discretionary sectors faced declines. This mixed reaction reflects uncertainty in the market as investors weigh strong labour market data against concerns about rising unemployment and sluggish wage growth. 

Despite the positive job additions, the probability of a Fed rate hike in September dropped to 7%, indicating that the central bank might maintain its wait-and-see approach. Overall, the S&P 500 closed the week with a modest gain, and the market awaits further developments to provide clearer direction in the coming sessions. 

Technical 

On the 4-hour chart, the index is currently trading at 4,528.50, within a consolidation zone. Notably, it remains above key exponential moving averages (EMAs), with the 50-EMA (blue line) recently crossing above both the 100-EMA (red line) and the 200-EMA (orange line), suggesting bullish momentum.  

The Relative Strength Index (RSI) stands at 62.15, while the RSI-based moving average (MA) is at 64.02, also indicating strength in the current uptrend. 

For short-term traders, potential opportunities lie on the upside, with resistance levels at 4,566.25 and 4,596.75 likely to act as levels of significance should a bullish breakout above the consolidation zone materialize. 

Conversely, if the price breaks below the consolidation zone, short-term trading opportunities may emerge towards support levels at 4,481.50 and 4,439.50.  

Summary 

This mixed data is likely to keep the Fed on the sidelines as it weighs the need to continue raising interest rates against the risk of slowing economic growth.  

Overall, the outlook for the S&P 500 remains positive, with the 4,566.25 and 4,596.75 likely to levels of interest in the coming sessions; but investors should be prepared for some volatility in the near term. 

Sources: TradingView, Reuters, Trading Economics, CNBC.