Trading Plan for Wednesday, May 1st, 2024
Trading Plan for Wednesday, May 1st, 2024
Market Sentiment: Uncertain, with the potential for sharp swings amplified by the FOMC announcement. Increased caution and focus on capital preservation are paramount.
Key Supports
Major Supports: 5060 (major), 5043-47 (major), 5030-32 (major), 5000 (major)
Additional Supports: 4976 (major), 4938-41 (major)
Key Resistances
Near-term Resistance: 5066, 5077-82 (major), 5102 (major), 5144 (major)
Major Resistances: 5171 (major), 5200 (major), 5246-50 (major)
Trading Strategy
FOMC Volatility: Expect unpredictable price swings driven by reactions to the FOMC interest rate decision and related news.
Prioritize Capital Preservation: Focus on protecting your account rather than chasing aggressive moves. Adapt position sizing and risk management strategies accordingly.
Long Opportunities: Due to FOMC, direct bids are high risk. Focus on failed breakdowns for better risk/reward. Potentially long at major support levels after flushes and reclaims (5043-47, 5030-32).
Short Opportunities: Due to FOMC, direct shorts are also high risk. Watch for strong bounces and failed breakdowns. Consider shorts at key resistance levels only if the reaction to FOMC is definitively bearish. Proceed with extreme caution.
Level-to-Level Trading: Employ level-to-level scalping techniques and profit-taking, navigating this volatile environment with tighter stops.
Bull Case
Holding Support: Defending the 5043-47 support zone is crucial for bulls, with 5030-32 as the absolute minimum. Reclaiming resistances like 5066 could indicate buyer strength.
Bear Case
Breakdown Signals: A convincing break below 5030, intensified by negative FOMC news, signals a downside move. Watch for bounces/failed breakdowns for potential shorts.
News: Top Stories for May 1st, 2024
Global Economic Outlook
Mature economies are stabilizing with a slight growth uptick projected for 2024 and 2025.
Emerging economies maintain stability with growth projections at 4.3% for both 2024 and 2025.
Regional Trends
Asia, including China, anticipates a slowdown, while Latin America expects gradual growth increases.
Inflation and Monetary Policies
Global inflation is expected to decrease, reflecting central bank rate hikes for price stability and growth support.
Geopolitical Impacts
Populist policies and recent elections in the US and EU pose financial policy and market stability challenges.
Transition to a New Monetary Order impacts interest rates, asset values, and lending environments globally.
EU regulatory changes affect financial markets and trading regulations, emphasizing compliance.
Digital Transformation
Focus on digital assets and CBDCs outside the US signals shifts in financial transactions and regulations.
Blockchain technology enhances financial security and transparency, notably in DeFi platforms.
AI integration reshapes financial services, optimizing operations and decision-making processes.
Digital and open banking experiences exponential growth, fostering fintech innovations and collaborations.
RegTech solutions powered by AI help firms manage regulatory obligations efficiently across jurisdictions.
Market Sentiment: Uncertain, with the potential for sharp swings amplified by the FOMC announcement. Increased caution and focus on capital preservation are paramount.
Key Supports
Major Supports: 5060 (major), 5043-47 (major), 5030-32 (major), 5000 (major)
Additional Supports: 4976 (major), 4938-41 (major)
Key Resistances
Near-term Resistance: 5066, 5077-82 (major), 5102 (major), 5144 (major)
Major Resistances: 5171 (major), 5200 (major), 5246-50 (major)
Trading Strategy
FOMC Volatility: Expect unpredictable price swings driven by reactions to the FOMC interest rate decision and related news.
Prioritize Capital Preservation: Focus on protecting your account rather than chasing aggressive moves. Adapt position sizing and risk management strategies accordingly.
Long Opportunities: Due to FOMC, direct bids are high risk. Focus on failed breakdowns for better risk/reward. Potentially long at major support levels after flushes and reclaims (5043-47, 5030-32).
Short Opportunities: Due to FOMC, direct shorts are also high risk. Watch for strong bounces and failed breakdowns. Consider shorts at key resistance levels only if the reaction to FOMC is definitively bearish. Proceed with extreme caution.
Level-to-Level Trading: Employ level-to-level scalping techniques and profit-taking, navigating this volatile environment with tighter stops.
Bull Case
Holding Support: Defending the 5043-47 support zone is crucial for bulls, with 5030-32 as the absolute minimum. Reclaiming resistances like 5066 could indicate buyer strength.
Bear Case
Breakdown Signals: A convincing break below 5030, intensified by negative FOMC news, signals a downside move. Watch for bounces/failed breakdowns for potential shorts.
News: Top Stories for May 1st, 2024
Global Economic Outlook
Mature economies are stabilizing with a slight growth uptick projected for 2024 and 2025.
Emerging economies maintain stability with growth projections at 4.3% for both 2024 and 2025.
Regional Trends
Asia, including China, anticipates a slowdown, while Latin America expects gradual growth increases.
Inflation and Monetary Policies
Global inflation is expected to decrease, reflecting central bank rate hikes for price stability and growth support.
Geopolitical Impacts
Populist policies and recent elections in the US and EU pose financial policy and market stability challenges.
Transition to a New Monetary Order impacts interest rates, asset values, and lending environments globally.
EU regulatory changes affect financial markets and trading regulations, emphasizing compliance.
Digital Transformation
Focus on digital assets and CBDCs outside the US signals shifts in financial transactions and regulations.
Blockchain technology enhances financial security and transparency, notably in DeFi platforms.
AI integration reshapes financial services, optimizing operations and decision-making processes.
Digital and open banking experiences exponential growth, fostering fintech innovations and collaborations.
RegTech solutions powered by AI help firms manage regulatory obligations efficiently across jurisdictions.
