FOMC Day Tomorrow, Volatility Incoming For SPX. Will The Dip Get Bought? May 3rd plan

After 4 days of straight, one directional, “every dip predictably bought” upside, ES reversed gears today, putting in a 90 point sell and retracing over 60% of the rally. This dip is now the 3rd since the March 13th low: We had 130 points on March 22nd, which was bought, then 125 points last week, also bought. Like the others, today’s was also bought

I wrote yesterday: “What is clear though is that we have rallied 130 points in a few days, heading into a data heavy week and this means volatility and complex trading is likely ahead, including an elevated risk of rug pulls if the right catalyst is given”..adding “Rug pulls come when supports fail, never before. For tomorrow, the core level to watch in that regard will be 4172”. Rug pull it was, and we lost 4172 this morning triggering a one directional 60 point melt-down and the first short in days.

Tomorrow, however, is FOMC day and that means all today’s action needs to be taken with a major grain of salt. Is the low already in? In today’s newsletter, I’ll be talking FOMC day trading principles as well as what happened last few FOMC’s, talking the setup here, then providing the actionable trade plan for tomorrow.