Monday’s gains were short-lived.
Tuesday, markets declined as the FOMC meeting convened.
- Dow Jones -1.0%
- Nasdaq -1.0%
- S&P 500 -1.1%
- Russell 2000 -1.4%
There were few bright spots. 79% of all stocks closed the day lower.
All 11 sectors fell too.
The smallest losers…
- Consumer Defensive (XLP) -0.6%
- Technology (XLK) -0.6%
- Consumer Discretionary (XLY) -1.7%
- Materials (XLB) -1.9%
- Real Estate (XLRE) -2.6%
Ford’s $1 Billion Problem
Ford (F) fell 12% on Tuesday after issuing a warning to investors.
It said a “parts shortage” and “inflation-related” costs will take away “~$1.0 billion” in profits in Q3.
- The auto maker’s market cap took a $7 billion hit as a result
- It still expects between $11.5 and $12.5 billion in profits in 2022
The S&P 500 is rangebound in the “buy zone” we called out earlier this month.
A break to the high side is the final signal we need to initiate a position.
This morning, as we wait for The Fed’s decision…
- The VIX is rangebound between 25 and 28
- RSI levels remain neutral for all four major indexes
- The Put-to-Call Ratio is neutral
Today’s moves will reflect investors’ reaction to the Fed, not market pressures.
The FOMC meeting concludes today.
- The new interest rate drops at 2 PM
- Fed Chair Powell speaks at 2:30
Three things to remember…
- A 0.75% hike is already priced in
- Never believe the first move
- The market loves Powell
*BWEN resistance at $3.50
TNK on watch
ADN support at $4
EPM support at $8
SAVA on watch
MNTK support at $18
DCPH support at $18
RVNC support at $25
^SGML support at $25
PGEN support at $2.60
NAT support at $3.35, resistance at $3.50
^GERN resistance at 2.80, support at $2.60