Another interesting day with some great learning to be had. Multiple news items came into play today. The 10:30 Crude inventories was a huge build but Oil had traded down into the announcement then rallied. The news was “priced in” and it was a good learning moment if you were watching it live.
Everybody knew that the number was going to be negative, Business news was talking about it all morning. It was a case of “sell the rumor and buy the news”.
Nothing has changed since yesterday. The markets are still in play short term after a solid up day the S&P 500 closed at 1903 well above our watch out area.
News Driver: North American markets in “wait and see” mode for today’s 2pm FOMC rate meeting. Oil is trading at $30.50 as I write this and is trading in a range waiting for the 10:30am Crude Oil Inventories report.
European markets are down slightly and Asian markets bounced back nicely overnight (excluding China, it was flat)
Into the open we see a weak-form risk-off tone to equities globally, anticipating an indecisive trade leading into Yellen’s 2pm (EST) Monetary Policy announcement.
North American markets experienced downward pressure most of the day. This came as no surprise as we discussed in the Morning huddle this morning. Oil was the driver today and it wasn’t pretty down more than 7.4% .
Today’s action on the S&P 500 was very narrow with lighter than average volume. If you know what to look for; the internals and candles will offer you the “clues” you need to make higher probability trades.