- The S&P 500 showed unimpressive early Friday strength, stalled below 6900, and remained weighed down by low volume and caution ahead of the upcoming FOMC decision.
- Despite the choppiness, support near 6800 keeps the broader bias tilted upward.
The S&P 500 rallied a bit during the early hours on Friday, but it just seems to be somewhat feckless as we can't break out above 6900. In fact, so far, midday at least, the trading session has been more or less a waste of time as traders have pushed the market higher only to give up again. Volume is anemic at this point. And I think most traders are just out to lunch. I think they're waiting for the Wednesday session, which of course features the FOMC interest rate decision and could move these markets wildly.
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And perhaps more importantly than that, we have the press conference afterwards and the statement. The question at this point is going to be whether or not the Federal Reserve is going to cut continually. It seems to me, as an observer of the market, that a lot of traders are not going to be happy unless they get multiple cuts in a row. And at this juncture, it'll be interesting to see whether or not that actually is suggested.
Ultimately, this is a market that will continue to be very choppy and noisy, but I'd still favor the upside. I have no interest whatsoever in trying to short the market. And I think the 6800 level offers a bit of support. That being said, though, I think you have to look at this as a market that just has to prove itself with a little bit of momentum, as we are just killing time at the moment.
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