F_O_M_C Wednesday

For the 4th time, the most important F_O_M_C meeting ever, is the 4th time the charm or the taper?

Strangely, very unlike Monday overnight when the 3C overnight market was crystal clear, the overnight market for most assets was not only choppy, but flat in 3C, not meaning 3C isn't working, but no one seemed to be doing anything.

There was a bid in some safe haven currencies and the Yen, although the Nikkei 225 has been flat and choppy more or less this week.

I was shocked to see gold and silver (more gold) looked the same way and the $USD, almost as if the market has no sense of what to expect or like Monday, the pop or drop will occur suddenly as regular trade opens.


The $AUD was rangey / choppy, but losing 3C support, the Euro looked similar, but closer to inline, it's the longer term, more important $?USD chart that looks definitely taper on, the 30 min positive.

 30 min $USD looks like it will move higher, this is not a good signal for QE lovers, you may recall VIX futures look the same, again not good.

However VIX futures don't trade overnight so we don't know what they'll look like yet, early trade will be the key.

Crude as I said Monday night looks as if it will bounce as this 5 min positive chart is starting to show, but I think it will be a bounce to nowhere or in to the chop. At least it was a rare overnight signal.

ES gave some hint of negative overnight activity, but it was worse during regular hours yesterday.

I'd say it looks like a holding pattern overnight not wanting to give away what may be a surprise attack like Monday's open.

We'll be watching as we have found major moves 2 hours before the F_O_M_C that were easily tradable, even on QE3 day (Sept. 13th 2012).

Housing starts and permits missed, but since last starts were revised lower, today's 5th consecutive miss could be spun as an increase with the former revised lower than today's 5th miss in a row.

Starts was no better, the rental business seems to be dying as predicted, the annualized rate of sales (mostly cash and private equity firms) dropped from a high of 356k annualized in March to 252k annualized, remember I said, "Watch for these firms to start dumping portfolios of 75k rental units/homes at a time, just wait.

As ALWAYS, BEWARE THE INITIAL F_O_M_C KNEE JERK REACTION, 90% OF THE TIME IT IS WRONG, LASTING BETWEEN A FEW HOURS TO A FEW DAYS.

I may be slow on email responses if I get a scent and start looking everywhere to confirm as the information pre-F_O_M_C is most useful and we often or at least often enough, find it despite price action to make for some good entries, this would be the best.

Good trading to you!