Midweek Market Update March 22, 2023
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Midweek Market Update March 22, 2023
Another Fed Day is in the books
A very brief note today:
Fed Chairman Jerome Powell delivered the expected 25 basis points rate hike and the market started higher.
Then, the language in the press conference was a bit more dovish, removing phrases like “ongoing rate hikes” and instead saying “some additional hikes may be needed.”
But then Janet Yellen had some comments on the banks that presumably spooked things a bit. She indicated that the Federal Reserve is not considering insuring all bank deposits. Maybe that’s what did it.
Regardless, selling took over and turned what started as a nice rally into some pretty ugly daily candles.
Fed day market moves have been reversed many times on the following day though. Tomorrow the story may change somewhat.
Here is where things ended.
The Charts
SPY moved through the swing high AVWAP and the 50-day MA before reversing sharply. The selling resulted in a bearish engulfing candle that closed below the 21 EMA, the 8 EMA, and the 200-day SMA. Not a good finish.
QQQ looked like it was unstoppable as it cleared the $313.68 pivot and moved higher. The daily candle is ugly, but it’s still above all the key moving averages.
IWM was the weakest of the major indexes as it was unable to get above yesterday’s high. $170.34 is looking very important now as a move below would likely send this back to the 2022 lows.
DIA opened at the declining 21 EMA and closed beneath the 8 EMA and 200 SMA. The 316 area and the Covid low AVWAP will be very important.
DXY - The Dollar sold off sharply and was very near the 50% retracement at one point. Even that wasn’t enough to keep stocks higher today.
VIX bounced hard as the selling kicked in.
Several cautionary signs and still plenty of chop and indecision.
Remain patient and nimble as we see what comes next.
***This is NOT financial advice. NOT a recommendation to buy, sell, or trade any security. The content presented here is intended for educational purposes only.
Andrew Moss is an associated member of T3 Trading Group, LLC (“T3TG”) an SEC registered broker/dealer and member of FINRA/SIPC. All trades placed by Mr. Moss are done through T3TG.
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POSITION DISCLOSURE
March 22, 2023, 4:00 PM
Long:
Short: SBNY
Options symbols are denoted as follows:
Ticker, Date, Call/Put, Strike Price
Example: VXX1218C30 = VXX 12/18 Call with a $30 strike