Today we had the reaction to the FOMC announcement that I was expecting, a failure at overhead resistance that dropped down to the support at our pivot, almost exactly, and going out on the lows.
What next? It's hard to say. The best that can be said for the bulls is that the selling today was on volumes that remain light. But that is also a negative, because this means the market has not yet flushed out to the downside.
This leaves the equity market open to manipulation by the big trading desks, who will trigger a snapback rally if too many specs pile on to the short side. But the momentum is now to the downside.
I would look for the futures to test the lowest levels of the overnight trade during that session, and then a recovery and probe back down after the New York open, and most likely a snapback rally during the day to squeeze the spec shorts. At least, that it the strawman, but we'll trade the market we are given.
Cisco missed its revenue after the bell, but hit its earnings, which is a almost a slam dunk given their acquisition and holdback style of accounting. This does not bode well for the techs.
NYSE Volume
Today we had a pullback in gold to support. The traders on chatboards greatly exaggerate these moves in their chatter. Try not to fall into that trap. So far the trend is well intact.
For the mystery of lawlessness is already at work. And the name of the lawless one will be revealed. Not everyone who calls to me saying, ‘Lord, Lord,’ will enter the kingdom of heaven, but only the ones who do the will of my Father. Many will say, ‘Lord, did we not prophesy in your name? Did we not drive out demons in your name? Did we not do mighty deeds in your name?’ Then I will declare to them solemnly, ‘I never knew you. Depart from me, you servants of lawlessness.'
Matthew 7:21-23