how to trade the FOMC rate decision

Afternoon traders.

Back in your inbox with another market brief.

We’ve got a juicy one for you as we await the FOMC rate decision this Wednesday.

We go over the exact levels we’ll be watching and how to trade them.

Let’s jump in!

Impact Snapshot

  • US job openings unexpectedly increase to a three-month high

  • Afterhours Earnings: 

Market Evaluation

U.S. stocks were lower after consumer-confidence numbers and job-opening data point to a sturdy economy that keeps the chance of Federal Reserve rate cuts at the front of mind for investors.

A hotter-than-estimated reading on the labor market spurred a slide in bonds, with traders dialing back their projections for interest-rate cuts.

Traders will watch for updates out of the Federal Open Market Committee’s two-day policy meeting beginning Tuesday.

The fed funds futures market has priced in an approximately 97% probability that the central bank will leave rates unchanged during its Wednesday announcement.

Today, market is anticipating the all important earnings from Microsoft & Google, the tech behemoths that have powered the rally from the bottom amid the artificial-intelligence excitement.

A slew of important economical releases will hit the market tomorrow with ADP Nonfram payrolls and FOMC Rate decisions being the main focus.

Ultimate TradingView Suite

By pairing our market report we’ve posted since the overnight session Here, our exclusive Tradingview suite and confirmation from our Q_Pro toolkit, a tick-perfect opportunity was taken at the exact point of interest and scenario we were looking. It’s all about adding confluence and context around price.

Markets Breakdown

After the breakout from balance on yesterday’s closing hours of US session, the first thing to monitor is acceptance of new prices above or the lack of.

The same scenarios we’ve been talking about the prior week was the market’s ability to negotiate price and build value to the upside. 

A rejection will put us right back into the balance bellow with bulls wanting to defend the key level of 4930 which was the top of the multi-day balance.

The market has a lot of catalysts ahead of it until Friday so we will exercise caution as the major earnings paired with key economical releases can change the tides drastically.

Remember, this whole upside continuation of 2023 was mostly initiated by the Tech sector with the AI anticipation and implementation.

The moment we get negative data regarding these big caps we will witness some serious liquidations.

ES

The targets we look for until NY close & Targets to pay attention Tomorrow:

  • Upside Levels: 4966/4974/4989

  • Downside Levels: 4927/4917/4896

That’s it for today.

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We’ll see you Thursday!

-The QuantVue Team