Wednesday Market Wrap- Welcome Ms. Yellen



For the day the SPX/DOW were -0.65%, and the NDX/NAZ were -0.60%. Bonds lost 33 ticks, Crude added 20 cents, Gold dropped $2, and the USD rallied.

Nothing has changed on support and resistance for SPX from Monday.  Short term support is at the 1841 and 1828 , with resistance at the 1869 and 1884.

We came into the day as I said last night, very short term overbought, we ended the day short term oversold.

We had one stop today and it resulted in a +5.8% return. (CTRL).  This is why I always stops as prices rise, because when you have a day like today, it may stop, but at a profit. You can always buy them back.

I think this Yellen thing may have already done its damage. If the fed funds rate goes to 1% by the end of next year, the market should still trend a  lot higher. There will  be hiccups along the way, but there always is.

The market is still hungover from a year of incessant taper rhetoric and obsession, so today when Yellen announced that the fed funds rate could get lifted 6 months after the taper stops in the fall, the market knee jerked, Most thought it would be more like  a year after the taper ends. Big deal. Still the lowest rates we will ever see in any of our lifetimes.

Bonds got sold hard, gold dove, and utilities and bond equivalent type stocks got hammered. The real estate investment trust stocks also got crushed as they should as rates lift. See IYR.

We still need to watch those very short term SPX levels that I mentioned above.. The bulls will need to protect those areas for them to keep the uptrend in tact.

The banks acted well today, and now that the direction for rates seems to be up again, they may play bullishly. I may have a name for you tomorrow. I want to see how the market opens.

I adjusted stops tonight, so please check them and stay updated if you are following at home.

See you guys in the trading room in the morning.

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