Crossroads with the Fed

Hey Gang:

Well "Uncle Ben" Bernancke and his other Fed Chiefs will be releasing their FOMC decision on interest rates today. The consensus is there will be no rate change. This of course will not move the markets much, but it is what they say in their statement that may. Inflation is still a concern, and the dollar has been weakened of late, so there may still be talk of a rate hike. That would send the market down and in the case of our chart, keep the $12,300 level as resistance. You'll see last time we hit this level from the post 2/27 fall, it followed up with a $240 point fall. I am not saying this will happen again, just that this run-up may have been a Bull Trap, and the markets will fall off here once again and we may become rangebound here.

If the Fed decides to LOWER interest rates, the market would EXPLODE higher here and we would make a Higher-High, indicating a resumed Bullish trend. We'll just have to wait and see.

Happy Trading!