Traders and investors alike should feel confident playing the support and resistance levels, and we are expecting a consolidation. The reality is that we are unlikely to see any big bets to make or break this market ahead of the Fed.
The MAR14 E-mini S&P 500 has hit another downside target/support level overnight of 1760, but then staged a powerful rally all the way to 1785. The market is now up 17 points, and looking to us at least that a bottom has been put in.
The S&P began pulling back from the highs yesterday for two taper related reasons. First the deal in Washington opens the door for a Fed taper next week. Second, the S&P gave a push toward highs early into Tuesday's session and set up a technical failure.
Today's Macro Theme Is "Good News Is Bad News" — Watch Today's Number For Direction: Equities played a game of Pac-Man yesterday and although making it tough to hold a position, the levels continue to work.
Equities have continued to hold value well as we look to PPI and Confidence numbers today and the Fed begins its two-day meeting. This session's early high in the S&P is slightly lower than that of yesterday with 1761.25 compared to 1762.25.