NEW YORK (TheStreet) -- Earlier today, the monthly Automatic Data Processing jobs report was released, showing private-sector payrolls increased by 175,000 in January, falling short of estimates.
Now we have to wait until Friday to see how the ADP number will match up with Bureau of Labor Statistics' nonfarm payrolls number and to see how the market will react.
Watching the release of the jobs report for December and seeing the market move higher made me realize that it seemed as if the market always went higher with the announcement of the official numbers regardless of what those numbers were.
In the last 18 months, there has been a statistically significant likelihood that during the week preceding the report and the day preceding the report that the market would move higher. The following week the market performed no differently whether preceded by the jobs report or not.
As with all statistics, it helps to look beyond the numbers to try to understand possible factors that may have played a role.
One factor may be that the past 18 months contained the beginning of the third and final phase of quantitative easing, the Federal Reserve's bond-purchasing program.
I wasn't excited about being further long in a market in anticipation of a run-up fueled by the jobs report, considering the connection between the Fed's policy announcements and the market's fortunes. Certainly, the past month causes one to rethink a bullish thesis.
Now, in hindsight, starting the week with a 325-point loss indicates that playing the market for a weekly advance in anticipation of Friday's report wouldn't have been a good idea.
However, about half of the weekly gains seen in weeks that included the jobs report came on the day of the report, suggesting that there might be some advantage to adding long positions prior to Thursday's close, even in the face of a market teetering and looking for direction and even in the face of losses earlier in the week.
Based upon the pattern of the past 18 months, although I generally don't consider index exchange-traded fund trading, I may look at purchasing shares in SPDR S&P 500 ETF (SPY) with the anticipation of closing the position at the end of Friday's trading by selling slightly out-of-the-money call options on the position, as premiums are beginning to reflect increasing volatility and could enhance any report-related advance in the index.
While statistics may have a wonderful ability to confirm whatever thesis one wishes to expound, the relative benign reaction to today's benign ADP report gives me reason to suspect that optimism may be warranted from 3:59 p.m. Thursday until 4 p.m. on Friday.
At the time of publication, the author didn't have a position in the fund mentioned, although he may purchase shares in the next 48 hours.
This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.