Will This FOMC Pullback Be Bought In SPX? March 23rd Plan
In yesterdays newsletter, I wrote: “As I have said many times, the worst, most complex, trap-filled, noisy, random days for ES are FOMC days, with CPI and NFP’s a close second.” Today certainly lived up to that warning, with ES establishing a range between 4070 and 4000 and ping ponging violently and randomly inside it for two hours before a late day collapse.
Bears won out on the day though with ES ending the day red, commencing the first pullback after a 175 point non-stop rally from Monday low. As written extensively, on Monday ES tested its core bull market trendline from March 2020 at 3895, starting this 175 point leg up. Today started the first proper dip of this leg. The question - of course - is, is this yet another buyable dip as part of a new leg higher, or the start of a more sustained selloff?
In todays newsletter, I’ll be addressing this, going over my core failed break-down setup that I use on trappy FOMC days like today (and everyday) and providing the actionable trade plan for tomorrows post-FOMC session.