S&P 500

The S&P 500 was very quiet on Tuesday, as we await the Federal Reserve monetary policy statement and of course the press conference afterwards. There are a lot of questions as to what the trajectory of interest rates will be, and that, of course, will have a massive influence on where stock markets go. Currently, I think the 2700 level is massive support, but it’s not until after we get the reaction from the press conference in New York that I would be comfortable putting a position on. In fact, it’s probably best to sit on the sidelines and wait for a daily close before putting money to work. If we get a signal that the Federal Reserve is only going to raise interest rates 3 times, there will probably be a rally. Alternately, if we get a signal that they are going to raise interest rates 4 times, it’s likely that stock markets will sell-off.

Nasdaq 100

The Nasdaq 100 initially fell during trading on Tuesday but turned around to form a hammer. The hammer, of course, is a bullish sign, and I think that if we get some type of dovish statement or at least less hawkish than anticipated out of the Federal Reserve today, we could see this market reaching towards the 7000 level. A break above the 7000 handle would be very bullish. Alternately, I believe that a breakdown below the bottom of the candle for the session on Tuesday could send this market looking for 6800, and then potentially down to the 6700 level. This is a market that will be very sensitive to what goes on with the Federal Reserve, so please keep this in mind.

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