The more I watch this market every day, the more and more it looks like a market amid transition. With the massive amounts of volatility, the big swings every day are the signs of a market that is battling to find its next major trend.

The BLS job report may help to settle one major issue tomorrow regarding the Fed and tapering. It will probably take just a decent report to get the Fed to taper in November with no change in the unemployment rates. Anything that shows further improvement in the job market will be all the Fed needs to make a move. The bond market appears to be fully prepared for it. Today the 10-year moved up to 1.58%, while the 2-year moved to 31 bps. It seems like the 10-year is on a path to resistance at 1.63%.

We know this move higher is all about the Fed because the big jump began on September 23, the day after the FOMC meeting.

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Today’s is another perfect example of a stock market moving away from a Fed acting as a tailwind to a Fed that will no longer be present. On top of that, there are clear signs that earnings revisions are moving lower across the broader index, and with earnings starting in a big way next Wednesday, things will get interesting.

The S&P 500 finishing the day higher by around 80 bps, but that was nearly 70 bps off the intraday high. You can’t blame the late-day sell-off on the VIX rising because the VIX hardly moved higher off the lows. The S&P 500 even tried to break above the downtrend but was unable to hold that breakout. Overall, this is a negative pattern and should lead to lower prices tomorrow, with the potential for a gap fill at 4,360.

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Facebook (FB)

Facebook fell on the day by more than 1%. I guess given what has been in the news, the struggles aren’t all that surprising. The stock made it back to resistance at $334.50 and couldn’t make it any higher. If it undercuts the recent lows at $323, I think that will be lights out as it heads back to $299.

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Amazon (AMZN)

Today Cowen lowered its price target on Amazon to $4,300 from $4,400. Not a big deal on the surface. But this speaks to the idea that consensus earnings estimates for the company for 2021 have been declining and are now seen at $52.80 per share from $55.84 back in July. Meanwhile, earnings for 2022 have dropped to $66.48 from $72.40. The same is true of revenue estimates that have been coming down for 2021 and 2022. It helps to explain the weakness in the stock more recently. If this trend of estimates falling continues into earnings later this morning, this could weigh on shares going into results, pushing the equity lower towards $3000.

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