Staying Present - June 17
Your Mid-Week Market Review
On last weeks Sunday Market Pulse:
we again highlighted the strong potential and likelihood of the market continuing to experience some downside. Monday the markets had a very bullish reaction off of the news that the US and Iran have officially reached a peace deal, with the signing scheduled for Friday, June 19. The markets seemed on track to put in all-time highs and leave all the bears in the dust. However, as we mentioned on X, we expected that the markets would slow down following Monday, as they want to really see the ACTUAL signing of the Peace deal and let this not be another false alarm. Tuesday we got that slow down in the form of SPY slipping 0.6%. The next big catalyst this week was today, FOMC. The FED kept interest rates unchanged and the markets finally got their first appearance of Kevin Warsh. Overall he had a hawkish tone and signed to investors that inflation is sticky and the FED is hyper focused to its 2% inflation goal. Market reaction was negative and today prices fell 1.25% and completely filled the price gap from Mondays opening print. Overall, we are very pleased with our forecasts and our patience and trust in our short-term understanding of where price was likely to go.
Technical Breakdown
Today was a very bearish day, with the markets dropping over 1%. The technicals confirmed the weakness as the ADD and SPY were in unison and the sellers showed a lot of strength today. Notice on the 15min chart, the surge trading volume as prices began to fall.
The chart above is the daily chart for the S&P500. Currently price has fallen to daily 50WMA and seems like it will test that moving average tomorrow. If lost, we expect price to fall down to the 0.5 fib level where there is confluence with the daily 200WMA and is a former level of resistance.