Maintaining a restrictive stance but viewing the 'cumulative' effects of Fed tightening up-to-now, is actually a slight shift to 'data dependency', without the Fed directly saying so.

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That's fine: not pivoting, but taking their foot off the brake a bit. 'Coasting' is a perceived policy response to realizing this takes time, but doesn't imply a lack of will to increase again, albeit likely at a slower pace (as I basically hoped). 

However that tone in a well-written Statement was later thwarted by Jerome Powell, creating not only a contrary perspective, but suggesting he personally is driving persistent tightness, because he basically disputed their statement. 

The Fed expressed awareness of the size of the Balance Sheet, and avoided a direct reference to 'debt service', but indirectly that's obvious by the Auction sizes that will loom ahead. 'At some point it becomes appropriate to slow the pace', Powell emphasized, while saying we have some way to go. It seems it is way soon to presume a slowing, given how he flipped the tone on its head.

He threw a bit of 'cold water' on the optimistic response by noting the inflation that is ongoing requires a sustained period of slow long-term growth, and rate levels that are going to be 'higher (for longer?)' that would otherwise be so. As his news conference evolved, he got tougher rather than leaving it alone.

What a cluster 'fracas' from the Fed. Small distinctions suggest that what is called the 'front-loading' period of tightening is over, with that boomeranged by the Fed Chairman, even as he contradicted his own tone a couple times.

What Powell wants to do is compress profit margins for companies, increase bank yields (nonsense as most Americans are more concerned about holding positions outside of the lowest return realm), and under the guise of protecting the poorest people (who actually suffer more from overzealous Fed hiking).

In-sum:

The Fed indeed indicated inflation is beginning to rollover, however Chairman Powell threw cold water on the idea they'll pivot anytime soon. So this clearly reversed market sentiment in the wake of the formal 'Statement'.

The 'Statement' from the FOMC was mildly dovish, leaving open the door to a friendlier tone. However Chairman Powell slammed that door by walking back what was likely a carefully and deliberately phrased 'Statement'. So now that of course sets-the-stage for selling in the morning, then some rebound try. In the case of Jay Powell, he kind of gave dovish sentiments, then reverted to a series of 'no quitting early' references, sort of like the Chairman all year.

But it is important to realize Chairman Powell did refer to there 'being an end' to this, although it's splitting hair to measure what they'll do in December or if he's drawing some sort of political line-in-the-sand too. (Fine-tuning time is the prep we're getting, even if he presented it in confusing contractions.)

He also acknowledge the challenged the strong Dollar has become for some 'countries', but didn't refer to how that impacts currency flows and margins for multinational or other foreign operators. There will come a point where some of the inflation contributors (he emphasized Housing) will come down. Sure.

The S&P got as high (or higher) than we targeted (3800) over the couple weeks, there is no significant measure for the Index to the upside given the backdrop, and indeed there nevertheless is a 'crowded' short-side as you again note from the chaotic nature of the day. I hasten to point out the Jobs number is coming, and a General Election. All can have market-moving implications, although unlikely quite as crazy as today's.

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