How Much Of A Cut?
With a 50-basis-point cut expected from the Fed today, the question remains how much of a cut will we see today.
S&Ps were at 1380, down 170. Not expecting much of a range today before 1:15 p.m. Central, when the Fed is expected to announce. Interesting to note that since that last 50-bp cut, we are 1000 points above the high of the day that cut was announced.
As for today, on the upside we have resistance at 1383, a key at 1384.50, 1385, a major at 1386.50, 1387 and 1391. Long-term objective on the upside is 1400. In order for that to happen, we have to get above 1389.50 and stay above it.
On the downside, we have 1378, a key at 1376.50, a major at 1375, then 1373.50, and a critical at 1371.50-1370.
NASDAQ was trading up 600 at 2703.50. The market made a low for the session near the close yesterday as Applied Materials
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PowerRating) pre-announced a shortfall in earnings for the upcoming quarter. We went from 2710 to 2672. However, the news did not appear to be as bad, and the market rallied back to settle down only 800 points on the session.
For today, we have the first area of resistance from 2700 to 2715. If we get above that, look for a move to 2730. Yesterday’s high was 2736. We would think that would be exceeded for a move back towards 2760.
We have resistance between 2750 and 2765. Above that, 2799, which is our recent high, comes into play. If we get above that, we then begin to retrace significant amounts of the recent down move, and the ultimate target would be 3048, which was our December high.
Support is between 2680 and 2670. Under that, look for a move to 2630. We have support between 2640 and 2625. If we get below that, we could challenge the 2595 level, which was Tuesday’s low. Only a close below 2600 brings a negative tone to the trade.
As for the Dow, it’s above 10,800, above which we like it. Next stop, 11,400. We have resistance at 11,000, which was our high on the surprise cut day of Jan. 3.