Annual Technical Bias: (SPY 200 day): Up
Monthly Technical Bias: QQQ 285, Up
Weekly Technical Bias: Up
Next Day Technical Bias: Down
EPS Fundamental Bias: Down
Fed Fundamental Bias: Up
Overall Medium Term View: Bullish
Overall Short Term View: A lot of news this week with Fed Wednesday and mega-cap earnings. Let's take it day by day. I'm bullish net net. For tomorrow some risk.
Fed Is Confused And That's A Good Thing
I think the Fed is confused. The Fed has been hinting they are facing mounting questions. They are slowing the pace of hikes. This meeting is 25bp and it seems like they want to see data over the next month. They are not prepared to cut or flip yet and need to see the next month or so of economic data to decide the next trajectory.
There's an internal battle at the Fed it appears if these massive hikes have already had their effect (if so bearish, they need to do more) or if there's a lag (bullish meaning they need to wait to see the impact so as not to send the economy into a negative tizzy).
Respectfully the Fed is admitting they don't know.
I respect that.
Since there appears to be a divided Fed even at the top with Waller tough but Brainard turned dove I think Powell's speech will be fine and I'm guessing at this point, not bearish.
That said I want to see technicals by the close on Tuesday to have some technical bias for Wednesday.
I think he'll say we need to see more data but in a way that may hint they are not sure about raising rates again. If so, that would be bullish.
I expect the more bullish side of Powell on Wednesday since the changes from his top lieutenants have shifted from all hawks to now some doves.
If Powell is 'let's see' I think the market will like that.
I think the market was down today with a confused Fed causing a confusing preview from the Fed. I think Powell will show some of that confusion Wednesday which I think is bullish for the stock market.
I respect a confusing message and it means that the Fed is maybe in transition.
Remember before, they were staunch, flag in hand, hike no matter what. Now their 'don't know' is a thaw and a change.
Notice the change.
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