Stocks finished the day sharply lower, just one day ahead of the most important jobs report ever. Yes, that’s right—the VIX 1-day rose and closed at 31.2 today. The market seems to think tomorrow’s job report is critical unless there is something else the market is worried about.

I’m not sure how to interpret that high of an IV level other than the possibility that the data itself may not even matter. Once the report is released at 8:30 AM ET, the stock market is likely to see a big move higher as implied volatility gets crushed.

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Considering that nearly all of the delta on the S&P 500 is negative, a significant amount of put value will be lost tomorrow. The decay in premiums will likely force market makers to buy back S&P 500 futures.

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But again, we’ve seen this play out before, and that reset in IV doesn’t last all day. If the IV reset happens and sellers step in later—which is possible given that CTAs are sellers and we’re in negative gamma—then the S&P 500 could test support at 5,690. If that 5,690 level breaks in the days ahead, the next significant support doesn’t come until 5,400.

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The jobs report plays a crucial role in interest rates, and today, we saw the 10-year rate rise to the 10-day exponential moving average, where it stopped and reversed. For now, the 10-year is wedged between the long-term trend, which appears to be support, and the 10-day exponential moving average, which serves as resistance. The problem is that only one can prevail.

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Finally, the USDJPY shows clear signs of strengthening, especially with the 10-year JGB now trading above 1.5%. Yesterday, it broke through 149; today, it extended further to around 147.90. If we drop below 147, I believe the JPY could strengthen to 143 fairly quickly. If that happens, the market could become very interesting very fast.

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