#sp500 #sp1! - Traders tagged the 50% fibonacci retracement level(yellow box) yesterday on the initial news of the rate cut by the Federal Reserve, and then promptly sold prices into the red closing just above the 23.6% fib level. This occurred even with the Fed once again intervening in overnight lending operations(REPO) on Monday night with $100 billion and a .50% rate cut to follow it up.
Overnight futures session shows traders keeping price between the 23.6% and 38.2% levels as they try to digest yesterdays cut, as well as what to expect at the next Fed meeting in two weeks. The main level to watch here remains the 50% fib, traders need to get price above the 50% fib as a signal that the Fed's intervention is being viewed as a positive and significant enough to calm the markets.
Attempting to trade this market going forward may be difficult as prices will likely whipsaw over rate cut probabilities ahead of the FOMC meeting in two weeks as well as deteriorating Covid19 news headlines.
Overnight futures session shows traders keeping price between the 23.6% and 38.2% levels as they try to digest yesterdays cut, as well as what to expect at the next Fed meeting in two weeks. The main level to watch here remains the 50% fib, traders need to get price above the 50% fib as a signal that the Fed's intervention is being viewed as a positive and significant enough to calm the markets.
Attempting to trade this market going forward may be difficult as prices will likely whipsaw over rate cut probabilities ahead of the FOMC meeting in two weeks as well as deteriorating Covid19 news headlines.