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An unequivocal reaction to FOMC yesterday. The market ran up in anticipation of dovish messaging, got the messaging it expected and then did something unusual. For some months now - nearly two years in fact - after Chairman Powell speaks, the market dumps. Sometimes for real and sometimes a headfake before moving higher, but usually there is red everywhere. Not yesterday. The J-Man Speaketh and Yea Verily Did Number Go Up. The momentum is continuing in premarket this morning. Single-stock earnings reactions are also, in my opinion, rather more bullish than they 'should' be, indicating a bounceback situation. AMD, QCOM, FSLY and PLTR have all printed good numbers this quarter but the stock reactions have been double-digit, and quickly too. That's a change in character in the market.
Seasonality is now on the side of longs, with a little Federal catalyst - or at least, lack of hindrance - assisting the way up. The trick now is, let the longs run without worry, and then try to catch the top of a material Wave 3 high in order to add some index shorts to win on the pullback too. The easy money is up; the difficult money is down. Patient with longs; impatient with shorts, for now, is how I am playing this next move in the market.
Let's Get To It
Paying members, scroll right down for our latest take on markets. As always we look at the 10-year yield, the S&P500, Nasdaq-100, Dow Jones and the Russell 2000; we consider long-term and short-term outlooks, and we lay out staff personal account trading plans in each of the indices. We add Bitcoin and Ether futures pricing for good measure.
Note - to open full-page versions of these charts, just click on the chart headings, which are hyperlinks.