Market Rallies for Stimulus

Stocks gained 217 points Friday despite the morning jobs report release showing a loss of 598,000 jobs in January and an uptick in the unemployment rate to 7.6%. The Dow started the day higher and steadily climbed throughout the entire trading day. When Pimpco's Bill Gross or Mohamed El-Erian speak, markets and leaders listen. In a morning interview with El-Erian on CNBC, he argued that government leaders need to take a "shock-and-awe" approach towards the economy. Investors seem to have pinned their hopes to Obama and Congress' ability to do just that. The $780-billion stimulus package looked near passage going into the weekend. Markets look forward to Obama's first primetime news conference in the White House on Monday expecting him to unveil some type of plan for the banks and greater detail on his overall economic plan.

The market rallied nicely today putting in a high at 8,312. First level resistance is at 8,400 with the 50-day moving average at 8,470. I would be a profit-taker off a potential continuation gap up on Monday. Any follow-through on Monday is not a time to add to positions.