6/15/22 The Day The World Didn’t End

News:

Yesterday the selling stopped … Sorta.

Markets trended down all day but rallied in the final hour to close mixed.

The Dow and S&P 500 gave up about 0.5% each, while the Nasdaq eked out a gain of 0.2%.

The Energy and Technology sectors were the only ones to close in positive territory.

The market has found some winners in the selloff. FedEx (FDX), Oracle (ORCL), and NIO (NIO) all logged daily double-digit gains for varying reasons.

And while stocks try to stabilize the carnage in crypto continues. 

Bitcoin^ slipped to $20,000 overnight.

Another stablecoin (USDD) has lost its $1 peg. The founder deployed $2 billion to try and save it but so far has been unsuccessful. It’s not the first and likely won’t be the last cryptocurrency to falter.

I believe the crypto reckoning is a positive long-term development. With any new technology, some projects are bound to fail.

This morning all eyes and crystal balls are pointed at the Fed.

At the 2:30 p.m. press conference, Fed Chair Powell will announce the size of the latest rate hike. 


Photo by Pixabay from Pexels

The situation has grown too complex to predict. The rate hike and the market’s reaction will play out in the coming hours.

More on that in the Timing section…

But first, let’s review the technical situation.

Technicals:

Markets are still oversold. The put-to-call ratio and RSI levels tell me the market is ready to bounce.

The VIX failed to break 35 again … Another positive for the bulls.


VIX Daily Candles – Chart via thinkorswim

The market wants to find at least a short-term bottom here. But today is not about indicators … Today is about the Fed.

Futures are up this morning but anything could happen when Powell speaks…

Timing:

We’ve said it once we’ve said it a thousand times … The Market Loves Powell!

But he can still get it wrong…

After today’s rate hike, the market will wait three weeks for the Fed’s minutes. And then three weeks after that is the next FOMC meeting.

It’s already been a long summer for the markets.

We expect the choppiness to continue until Q4.

Watchlist:

*Low Float
^Open Position

*AERC has support between $12 & 14
*AUVI has resistance at $4
*LPI
has support at $100
CBIO has resistance at $1.50
PBTS has support at $1, resistance at $1.50
^HDSN has support at $9
GLOP has resistance at $7, support at $6
COGT has resistance at $9
LI has resistance at $32.50

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