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Daily Market Update – June 15, 2016 (Close) Yesterday ended much better than it had been looking earlier in the day. With a reasonably strong loss on Monday, had the losses continued to that degree on Tuesday, there would have been some good chance of getting some kind of relief rally on Wednesday, almost regardless of what would have been contained in the FOMC Statement release. With some early morning strength, almost enough to offset yesterday’s loss, that could have left markets easily going in either direction at 2 PM and maybe even again afterward, as Janet Yellen was to hold her press conference. The expectation seems to be that there may be more dove than hawk today both from the statement itself and then during the press conference. Unless a real shocker were to come and interest rates were raised, there wasn’t too much reason for the market to behave badly. That is, unless another bombshell were to hit, such as any mention of the word “recession.” That latter bombshell seemed very unlikely, but it’s the unlikely that gets people’s attention and flames fears or greed. For today, I would have just liked to have see something that helped the market move higher. That’s not the way it worked out, though. As it was, there wasn’t much chance of me spending any money prior to the FOMC and not much likelihood of doing so after the press conference. What we saw was the market hit its high point right at the release, although not a really tremendous gain, no matter how you looked at it and then fall to close at its lows beginning immediately after the end of the press conference. What can we learn from that behavior? Nothing, except that maybe traders realized that dovishness at this point isn’t reflective of the kind of economy to write home about. At this point, I’d just like to see this week come to an end and get the July 2016 option cycle going. |
