4/6/22 The Market Fears the Fed & Define “Passive”

News:

Markets sold off ahead of the Federal Reserves March minutes release. The release is set for 2 p.m. this afternoon. Expect some volatility before and after. I never put much faith in the first move.

The markets remember the February 16th release that sparked a big sell-off. Note the chart below, the SPY declined ~8% in the week that followed the last minute’s release.

SPY Daily Candles – Chart via thinkorswim

Whatever is in those minutes has not been priced into the market yet. Fed Chair Powell is always extremely cautious about the words he uses. I expect the anticipation to be worse than the news…

Elon Musk is set to be added to Twitter’s (TWTR^) board. The CEO said he thinks Musk will “bring great value.”

Please note that this is not the “passive” investment that Bloomberg, CNBC, Barrons, Mint, and The Street reported. Here at Trading For Keeps we read the filings ourselves and made a conscious decision to exclude the word “passive” from our report yesterday.

No one that follows Musk could have concluded he would be a “passive” investor in Twitter.

The final stock worth a mention is Spirit Airlines (SAVE). According to a press release Jetblue (JBLU) sent an “unsolicited proposal” to buy the airline for $33 per share in cash.

In February Spirit announced plans to combine with Frontier (ULCC) for a stock/cash deal valued close to $25 per share based on yesterday’s closing prices. Jetblue outbid Frontier by about 30%.

Technicals:

The VIX rose above 20 yesterday its first significant gain in three weeks.

I’m not reading too much into yesterday’s selling. Most of the technicals remain bullish.

The Fed is the story to watch right now…

Timing:

April is historically bullish, so far it’s not disappointed…

Today’s focus will be on the Fed. I’m not concerned about where we open … I’ll be watching the close.

Watchlist:

*Low Float
^Open Position

*CLSN has support at $5.50
*THCA has support at $12
^*SGLY is on watch
*RAIL has support at $6.50
*BBAI is on watch
^NEXT has resistance at $7
GGR is on watch
NRGV has support at $18
^ASRT has support at $3
SGML has support at $15
BORR has support at $4
^LXU has support at $22
^GLNG has resistance at $25
SAVE has resistance at $28
BRCC has support at $22
SBS is on watch
^TELL has support at $6
TWTR is on watch

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