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Catalyst Sends Dollar Higher & Markets Remain in Range Formations- Aug 1, 2019

MARKET COMMENTARY

FOMC release shares the end of quantitative tightening and a 25 basis point move down in what some are calling the most important move of recent time with the central bank. As expected, the buy the rumor sell the news was clearly in play as the ‘secret’ of the move down was no secret at all. Remember when that was a thing, when you didn’t really know what the Fed was going to do?

PRICE ACTION -The e-mini S&P retreated to the base of deep congestion levels near 2960 before bouncing into and above 2982 where it is currently stalled. The mini Nasdaq slipped below our key support level near 7840 before bouncing but still holds below 7920. The mini DOW also tested well below daily support levels near 26816 before bouncing but interestingly, this one did not fail the deep support level near 26660. Pullbacks across the board should be bounce zones for the charts as long as they hold deep supports noted. Failure of these low zones tested yesterday bodes poorly for buyers.

COMMODITY WATCH -Gold is below the breakout level of 1422 but still very steady to the upside with its support bounce near 1412. I am looking for a dip into 1402-1405 to engage with bigger size, but holding 1412 is a bullish event in general. The USD index holds above 98. and that big bounce we were estimating is in full swing as we stretch into 99. The ‘tit for tat’ behavior of other central banks will like push the dollar down when that begins – but before then, we will likely see more upside. WTI Oil is fading but holding well above breakout regions near 57.16 (this is where I am looking for primary engagement)

INTRADAY RECAP – Decision zone – but with a bullish slant as we come into deep support. The levels and range between 3021 to 2964 is the watch data for the e-mini S&P’s. The mini Nasdaq holds the range between 7946 and 7812. Be careful here on the edges as we could accelerate out and continue if buyers or sellers get heavy on the edges.

OVERALL -Divergent action still sits below the movement of price on both sides of the trades – long and short – but traders are still looking at deep support edges to bounce.

WAIT STATE -POTENTIAL REENGAGEMENT OF THE METASTOCK SHORT ON THE BOUNCES IF WE BOUNCE BUT DO NOT BREACH 3021 AGAIN AFTER TODAY- Entries at or near 3015 with a 10 point stop will begin the downward cycle again.

If traders push us to close above 3015 today, we will have to consider a continuation long on the upside for the short term

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