S&P 500 could fall as much as 6% from here: Fairlead

Investing.com -- After the Bureau of Labor Statistics reported the addition of 256,000 jobs to the US economy in December, US equity futures fell sharply in premarket trading.

The job growth data reinforces the strength of the economy and could discourage the Federal Reserve from implementing any imminent cuts to interest rates.

Futures contracts linked to the S&P 500 were down by 0.8%. Nasdaq 100 futures also saw a decline, dropping by 1%.

Fairlead's technical strategists led by Katie Stockton addressed the market's reaction to the jobs report, commented that the bearish bias of daily and weekly indicators is preserved after the jobs report.

"We would maintain partial hedges to manage risk of a likely breakdown below ~5870 support by the SPX, which would increase downside risk the 200-day MA, currently 5.9% below".

This suggests a cautious approach towards potential market risks.

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Source: Investing.com