This is the Recap for today.
FROM MORNING NOTES (Sep 21 2022 – “FOMC DAY”)
As we go into this FOMC EVENT, DAX made bigger and bigger daily candles. Meanwhile, SPX is in the 3-day balance, which will likely be resolved tonight. LTF Support on DAX at 12,600 got broken in the Afterhours, and on weak SPX. On higher timeframes, this can be just a poke below it – since 60 points below 450-points wide range, CAN be just a false breakdown.That’s one of the early scenarios: market that is HOLDING above 12,600 and pushing inside Y RTH range, waiting for the FOMC EVENT there. Second one is: “Index goes where Futures already were”, to test Yesterday Afterhours Low, (could fill the gap on 12,520) and go back above 12600; OR - continue lower on EARLY WEAKNESS. While the first one is pretty simple, the second one can have variations. We can also note that Yesterday range is wide enough to be the “playground” for many hours, and that the potential catalyst comes VERY LATE for DAX, so any directional move that can be on this on US markets - DAX will have to catch up on it tomorrow. US markets are coiling, preparing the move. Note the 3x Daily ATR move that SPX made on US CPI. That was the OUTLIER Day, but this today can shake the market, and can make a start for new directional leg.
Breaking above 12,800 OR below 12,400 BEFORE the FOMC EVENT is a low odd scenario, that requires visible, and sustained momentum. Usual trading routine when market is waiting for the US data is “focus on the open, and grab the early opportunity”. There will likely be something in the first hour of RTH session. FADE / False break of the mentioned R zones, OR the same on lower supports, like S /12,520-540/ - that untested cash close at 12,520 is there for quite some time, so, IF markets roll down below 12,600 – this is the likely destination of such move.
Pre-FOMC recorded 2-minute Recap
I am always showing at least some of my trades, today showed one early trade and the late one, which was a FADE of the R2 zone. Showed this one as 2-tweets thread: