Is the Fed's Cred Shot?

I think there is a complete disconnect between the markets and the fed. If the market tanks today I think the FOMC cred takes a big hit.

 

... and if the markets don't tank today?

 

If the market believes the fed then we should have a rally that holds up. Im not sure if this will hold up. That leads me to believe that the market doesnt trust the fed.

 

James, before you can project what the market believes per the Fed, you must first <b>patiently</b> wait to see how price action finishes today = this week.

The statement of: <i>"Im not sure if this will hold up. That leads me to believe that the market doesnt trust the fed."</i> already assumes the market will fail today in order to confirm your belief. The market very well may tank into this close, but you cannot forge an opinion yet before confirmation on the charts.

Only reason I point this out? The early assumption of market action = price behavior is a learned pattern of thinking that kills most traders. Please do not assume - project what the market will or won't do. Just follow your charts, and believe the candles that print. Reacting to them when buy/sell signals come along is all you really need to know :>)

 

The price action is what Im basing my opinion on. I trade futures and this looks pretty thin to me. I dont see many big sizes trading at the bid and the offer.

 

Yup. I agree.

 

I also hate gaps in both directions and dont like how the vix is at the low end of the range. It tells me there isnt much firepower in the tank

 

So far today I've seen nothing but buy signals in the ES - ER at each low dip. Could see sell signals emerge similar to yesterday, and would sell into it myself with size... once downside failure is actually underway.

That said, we cannot assume the Fed is dead until the markets actually tank. We can guess - game the short side in expectation once sell signals flash, but we cannot assume today's opening ramp will fail = therefore the Fed has lost its cred until confirmation of such.

In other words, we are free to believe what we wish, but the intraday trade charts have given buy signals all morning. In the short-term context of market view, chart signals always trump "logical assumption" :>)

 

Good luck to everyone. Im just offering an opinion on what I see.

 

Is this the amazingly-insightful analysis one is to receive for their 2-large? I mean, you're seeing bullish signals here, right? Time to implement an IQ barrier to entry for this site.