S&P 500 Dipping Into Support Zone, FOMC-risk Mode
- Two-day FOMC meeting starts today, tomorrow most important
- S&P 500 declining into support
- Waiting for conclusion of Fed to see what moves should be made next
Today kicks off the beginning of the two-day FOMC meeting, with tomorrow holding the interest rate decision, policy statement, and Janet Yellen press conference. Rates are expected to remain unchanged, so as per usual it will be about any language changes in the policy statement and comments made by Yellen. And also as per usual no predictions will be made on this end, instead rather, we will let the market sort it out and tell us how it ‘feels’ about the outcome.
Nothing has changed from yesterday as the market is relatively quiet after last week’s fireworks ahead of this week’s event-risk. We continue to look to support in the short-term as opportunities to enter from the long-side. As discussed yesterday, old resistance becomes new support. A firm test and hold of the 1990/2010 zone in the S&P 500 could make for a potentially good entry; at the moment we are probing into that zone after touching off on minor trend-line resistance. Upward trend support off the Feb 11 low is in the vicinity as well.
As long as this range of support and 1970 below there holds, then so will the upward bias. A move below will warrant caution and potentially a flip in our view.
Similar to last week in regards to the ECB, once the FOMC meeting is out of the way we will learn more about what to do, if anything, in the very near-term.
S&P 500 Daily: Sep '15 - Present
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---Written by Paul Robinson, Market Analyst