FOMC Report To Be Studied for Clues

Investor’s first readDaily edge before the open

DJIA:  17,581
S&P 500: 2,065
Nasdaq  Comp:5,030
Russell 2000: 1,145

Wednesday:  Oct. 28, 2015   9:11 a.m.

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       While little new is expected at 2 o’clock this afternoon when the minutes of the FOMC are released, the Street will parse every word for a clue as to when the Fed will bump interest rates up for the first time since 2008.

       News on the economic front was mixed yesterday with a slight downward bias.

For the day, the Fed’s minutes from its two-day meeting this week will be the focus.

       Q3 earnings will continue to flow, though the direction of stocks will continue to depend on the Street’s perception of when the Fed will bump rates.

       Without a pickup in the economy, odds favor some time next year. With no Fed press conference scheduled today, a bump in rates is out of the question.  If one is suddenly scheduled  today, expect rates to be raised today. 

       No meeting of the FOMC is scheduled for November.

SUPPORT today: DJIA:17,416; S&P 500:2,046; Nasdaq Comp.:4,983

RESISTANCE today: DJIA: 17,635; S&P 500: 2,071; Nasdaq Comp.:5,045

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NOTE: Support and resistance levels are where I expect the intraday prices of the DJIA, S&P 500 and Nasdaq Comp. to reverse or close. Buyers should be cautious when a resistance level is reached but consider buying when support levels are reached. Sellers should consider taking action when resistance levels are reached and defer selling when support levels are reached. These levels are picked daily and based on my application of technical analysis.

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MY TECHNICAL ANALYSIS  of the 30 DJIA Companies

 On occasion, I technically analyze each of the 30 DJIA stocks  for a reasonable risk, a more extreme risk, and an upside potential over the near-term. I add the results of each, then divide by the DJIA “divisor” (0.149677) to get the DJIA for those levels. This gives me an internal check on the DJIA itself, especially if certain higher priced stocks are distorting the averages,
     As of  October 14, 2015,  a reasonable risk is 17,510 a more extreme risk is 17,430. Near-term upside potential is 18,045.
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  • STATUS OF MARKET: Bullish but “at risk” of  a correction, especially Fed-based
  • OPPORTUNITY: RISK: Risk increases with higher market, but light on the Street is GREEN in spite of negatives.
  • CASH RESERVE: 25% – 45%
  • KEY FACTORS:  Fed decision on rates; strength of economic rebound; Outlook for Q3/Q4 earnings; Stimulus Europe/China a catalyst !!
  • CONCLUSION:  Encouraged by the prospect the Fed won’t raise interest rates this year due to softness in the economy, the stock market has exploded from a consolidation area established after the August 24 “flash crash” and has penetrated deep into a resistance area developed when the market broke down  in August.

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Note: Source of economic data

For a weekly economic calendar and good recap of  indicators, go to mam.econoday.com.

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George Brooks
Investor’s first read
A Game-On Analysis, LLC publication

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Investor’s first read, is a Game-On Analysis, LLC publication for which George Brooks is sole owner, manager and writer.  Neither Game-On Analysis, LLC, nor George  Brooks  is  registered as an investment advisor.  Ideas expressed herein are the opinions of the writer, are for informational purposes, and are not to serve as the sole basis for any investment decision. References to specific securities should not be construed  as particularized or as investment advice as recommendations that you or any investors purchase or sell these securities on their own account. Readers are expected to assume full responsibility for conducting their own research pursuant to investment in keeping with their tolerance for risk

 

 

 

 

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