I’ve received 4 charts crossing the desk at this time that paint a sophisticated image for the Fed and the USD. We now have a selected sector falling off a cliff, broader resilience, a sentiment reset, and the one factor Jay Powell would not need to see: inflation ticking again up.
1. The Tech Sector is falling off a cliff
GS chart
First up, check out Tech-Associated Info Employment.
For the final two years, we have heard about “effectivity” and “AI integration,” however the headcount held up moderately nicely by 2024 and most of 2025.
We’re seeing a large purging of payrolls in information processing and internet hosting proper now in early 2026. That is high-income demand destruction taking place in real-time.
2. …However the broader labor market is stabilizing?
GS employment chart
Whereas tech is getting battered, the group at Goldman Sachs sees the broader image in another way.
Their estimate for underlying pattern job development—which adjusts for all of the immigration noise and catch-up results—suggests the underside is in. After a tough patch in late 2025 the place the pattern dipped into destructive territory, the forecast (that crimson arrow) is pointing to a rebound again towards 50k-100k pattern development.
The caveat is that the birth-death mannequin is difficult in the intervening time. Here’s what Goldman Sachs wrote:
The BLS launched a methodological change to the way it estimates web enterprise formation (the “birth-death” mannequin) that we suspect elevated the volatility of month-to-month job development in January.
We estimate that the birth-death mannequin boosted job development in January by about 70k relative to December (SA by GS), of which about 50k got here from the healthcare and training sector. Our estimate of the underlying tempo of job development based mostly on the payroll and family surveys now stands at +55k, although we notice that extra risky payrolls readings from the birth-death methodological change may argue for placing rather less weight on payroll development or smoothing it over an extended horizon than we presently use in our estimates.
3. The “FOMO” is gone
The most effective information for the bulls would possibly truly be this sentiment test.
We spent quite a lot of 2025 with the GS Fairness Sentiment Indicator flashing “stretched” (above 1.0). When everyone seems to be all-in, it’s laborious to discover a new purchaser.
As of Friday (Feb 13), we’re sitting at a Z-score of (0.2). We’ve washed out the euphoria. Positioning is now formally “gentle” to impartial. Traditionally, when sentiment resets to this degree with no full-blown recession, it units the stage for a bounce.
4. The Inflation headache is not over
Lastly, right here is the fly within the ointment.
The HBS Pricing Lab information reveals that after a pleasant dip in late 2025, every day pricing indexes are curling again as much as begin 2026. Each the “Least expensive” and “Costliest” baskets are bid, because the WSJ highlights at this time.
This confirms the narrative that the “final mile” of inflation is sticky. With the broader labor market stabilizing, corporations may need pricing energy once more.
The Verdict:
The market needs cuts as a result of Tech is hurting (Chart 1). However the actual financial system (Chart 2) and costs (Chart 4) counsel the Fed cannot be aggressive. With sentiment washed out (Chart 3), I’d be cautious of getting too bearish on equities right here, however the FX play seems like uneven waters for the USD till we get readability on that pricing pattern.
