Happy Friday traders. Non-farm payrolls are due at 8:30 EST.

The survey shows that we are expecting a figure of around 423k on the top line delta.

Markets have been meandering around below the 200 day moving average for what seems like every single day now. In the broad scope of things, this is pure chop and distribution/absorption before a larger trend move is about to happen.

Volatility is still creeping its head this morning. One of my favorite trade setups is actually to buy vol when it is setup like this. Why? You can use a local low (lets say 29-30 near this week's low) with a very tight risk-reward. Anyway, most good traders will be shorting there anyway but I would imagine anyone short vol right here and the nature of this chart coil up would take pause this morning to at least do some hedging for a nasty new high to undercut SPX levels.

I hope that wasn't too much of an incoherant ramble. I think the gist is that when vol is coiled and creeping higher, there is good risk-reward to ride the trend. As an eternal permabull for stocks, I can't really get behind shorting an index but buying vol? Sure.

The bonds on the other hand: what a mess. First, the trend is obviously lower. We haven't even started hiking yet and the the short-term rates are still kind of sticky near their highs.

The chart below is all that matters for me. Oil just rallied? Its bearish for bonds one month out.

My core positions are still long homebuilders, classic autos. Will be providing some more color / ideas towards mid-day. Best of luck and happy Friday!

Petr