SPX futures rose to test the 52-day Moving Average at 7607.17 this morning without ectending the decline in the overnight session. A rise above the 52-day offers a buy signal for the SPX. NDX appears to be in a similar position, beneath its 52-day Moving Average at 29191.00. All eyes are on the Fed this morning with the consensus of a possible .25% rate hike.
ZeroHedge reports, “Futures are higher into Fed Day where consensus is for a 25bp hike, the first since July 2023, with unknown levels of communication, and the question is what the dot plot shows (see preview here). S&P 500 futures are up by 0.3%, finding relief after days of selling as traders wait Kevin Warsh to deliver an expected interest-rate hike that will help ease fears that inflation may spiral.”
The premarket VIX held fast at yesterday’s low at 16.79. The Cycles Model allows three more weeks of decline toward the bottom trendline of the Ending Diagonal (wedge) formation. The target appears to be near 12.50, but it may probe lower, approaching the Cycle Bottom.
The US 10-year Bond Yield has slipped back beneath 50.00 this morning after making a marginal new high yesterday. The bond market awaits the FOMC news release to see how serious Warsh is about containing inflation.
The US Dollar paused at its high, awaiting the outcome of the FOMC news release. While there is the possibility of testing supports at 99.40 and 99.22, the trend is still higher. The weekend may bring a surge in trending strength to the USD>
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