Skip to Content
News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.



Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Please try again
More View More
S&P 500 Rallies as Traders Bet on Potential FOMC Pause in September

S&P 500 Rallies as Traders Bet on Potential FOMC Pause in September

Brendan Fagan, Contributor
What's on this page

S&P 500 – Talking Points

  • S&P 500 futures rally back above 4000, fail to take out last week’s highs
  • FOMC minutes reveal potential for a “pause” of hikes later in the year
  • Weaker Treasury yields, US Dollar could allow risk to thrive in short-term
Equities Forecast
Equities Forecast
Recommended by Brendan Fagan
Get Your Free Equities Forecast
Get My Guide

The S&P 500 continues to push higher following yesterday’s release of FOMC minutes, as traders continue to bet on a potential “pause” of Fed rate hikes later in the year. Risk pushed higher into the close yesterday as the minutes eluded to a potential “reassessment” of the tightening path following the next two FOMC policy meetings in June and July. This has seen the probability of 50 basis points (bps) in September decrease, while longer-term yields and the US Dollar have also cooled from recent peaks. These flows have provided a springboard for equities to push higher, as some of the hawkishness that has been priced in of late gets taken off the table.

In the premarket session, weaker-than-expected Q1 GDP data also helped ease pressures related to persistent Fed tightening this year. Thursday’s price action may help improve market sentiment, as the S&P 500 and Nasdaq 100 are both on track to break 7-week losing streaks. Whether the bottom is in for this downtrend remains to be seen. Threats to the outlook for risk assets remain, namely in the inflationary shockwaves from the war in Ukraine as well as China’s continued Zero Covid policy. That being said, market participants may remain split on the near-term direction for equities. Many may still argue that until we have true capitulation, whether that is a VIX spike north of 40 or another 90% down day, the bottom may not be in.

S&P 500 Futures 1 Hour Chart

Please add a description for the image.

Chart created with TradingView

Having finally broken through recent range highs at 3980, the squeeze higher through 4000 seemed almost inevitable. Following the unwind of a number of hawkish bets, risk has continued to perform well as we edge toward the closing bell in New York. A previous pivot point at the 4042 area proved no match today, with price pushing another 30 points higher before losing steam. Something to note is that price failed to take out last week’s highs around 4095. Should those highs give way to further upside momentum, it would not be out of the question to see a squeeze to the 4160-4200 range, given extreme bearish positioning and sentiment.

Trade Smarter - Sign up for the DailyFX Newsletter

Receive timely and compelling market commentary from the DailyFX team

Subscribe to Newsletter

Resources for Forex Traders

Whether you are a new or experienced trader, we have several resources available to help you; indicator for tracking trader sentiment, quarterly trading forecasts, analytical and educational webinars held daily, trading guides to help you improve trading performance, and one specifically for those who are new to forex.

--- Written by Brendan Fagan, Intern

To contact Brendan, use the comments section below or @BrendanFaganFX on Twitter

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.