It is Fed Day. The bank concludes its two-day policy meeting at 1:00 pm CT and is expected to hike rates by 25bps. With that decision a forgone conclusion at an 86% probability, the real takeaway will be the committee’s direction heading into the June meeting. What will the policy statement say, and how will Fed Chair Powell hold himself in the always volatile (for markets) press conference? The probability of another 25bps hike in June is merely 4.4%. These odds went from above 30% one day ago, to all but disappearing after fresh regional bank headlines yesterday.
We encourage you to read Monday’s Morning Express: ‘Buy in May, Is This Bull Market Here To Stay?’.
Although the Federal Reserve is front and center, it is the tip of the iceberg for a busy week ahead. A few highlights are:
- The first glance at jobs data for April via the private ADP survey this morning was 296k versus 148k expected. Nonfarm expects 179k.
- ISM Non-Manufacturing is due at 9:00 am CT. Prices and Employment components, like ISM Manufacturing, will be crucial.
- Weekly EIA inventory data due at 9:30 am CT, with June WTI trading below $70.
- China’s private Caixin Manufacturing PMI due tonight at 8:45 pm CT.
- ECB policy decision tomorrow morning.
- Apple reports earnings after the bell Thursday.
- On Friday, the Nonfarm Payrolls report is due at 7:30 am CT.
E-mini S&P (June) / E-mini NQ (June)
S&P, yesterday’s close: Settled at 4136.75, down 49.00
NQ, yesterday’s close: Settled at 13,184.50, down 122.50
Fresh regional bank news set off early selling yesterday, but the E-mini S&P and E-mini NQ worked off major three-star supports for solid finishes. Risk-assets broadly found support from lower JOLTs data and a weaker U.S. Dollar, which wrapped up with the bank news eroded expectations for a June hike. The rebound has worked back into the middle of the week’s range, marked by overhead resistances detailed below. At the end of the day, it is all about Fed Chair Powell’s press conference that begins at 1:30 pm CT. We would find today’s session extremely constructive if it holds out above major three-star support at 4104.25-4108.50 in the S&P. However, if this is violated, we could see a break below last week’s low in what ultimately becomes a test of rare major four-star support at … Click here to get our (FULL) daily reports emailed to you!
Crude Oil (June)
Yesterday’s close: Settled at 71.66, down 4.00
Global Oil demand growth fears are front and center, and recent price action is begging notice from OPEC+. Today’s EIA data is front and center with expectations at -1.1 mb Crude, -1.157 mb Gasoline, and -0.019 mb Distillates. With price action falling precipitously, it creates a range defined by the levels below, with the Pivot and point of balance being … Click here to get our (FULL) daily reports emailed to you!
Gold (June) / Silver (July)
Gold, yesterday’s close: Settled at 2023.3, up 31.1
Silver, yesterday’s close: Settled at 25.619, up 0.389
Gold and Silver responded terrifically from a hole following the one-two punch of fresh bank fears and lower-than-expected JOLTs data. This builds into today’s slate of economic data and the Fed policy decision. Traders must be ready for anything as each finds themselves back in the middle of the range and facing major three-star resistance at … Click here to get our (FULL) daily reports emailed to you!
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Originally Posted May 3, 2023 – What Are We Watching At Today’s FOMC?
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