FOMC Done. Now What?
Executive Summary
The FOMC delivered an expected 25 bps rate hike leading to an initial bearish reaction, but the true institutional directional positioning will reveal itself on Thursday and Friday. Key patterns in play include a potential 12-hour falling wedge on the NASDAQ and gold, alongside relative strength in select mega-cap tech and weakness in financials. The creator emphasizes patience, disciplined risk management via stair-step levels, and scouting weekly higher lows rather than forcing low-edge trades in choppy, balancing conditions.
Entities & Tickers Mentioned
- ✓NASDAQ is holding the bottom trendline of a potential 12-hour falling wedge pattern.
- ✓Semiconductors (SMH) and memory names defended critical daily support zones despite broad market pressure.
- ✓Select individual leaders (META, CRWD, AAPL) exhibit sustained relative strength near all-time or multi-month highs.
- ✗S&P 500 broke down from its channel and risks losing weekly EMA 12 support, opening the door to potential weekly head and shoulders structures.
- ✗Financial sector (XLF) broke down sharply and confirmed monthly consolidation.
- ✗US Dollar confirmed a daily double bottom and bounce, creating macro headwinds for equities and precious metals.
Key Talking Points
- FOMC reaction mechanics: The immediate 2:00 PM reaction is often neutral when rate hike odds exceed 85%, with real volatility emerging during the 2:30 PM press conference and institutional follow-through taking 1-2 days.
- Intraday trade management: High-volatility news events are best navigated by top-fishing/bottom-fishing key levels and trading 1-minute to 5-minute stair-step breaks with tight stops.
- Cross-sector divergence: XLF showed pronounced relative weakness dropping over 2%, but signaled a localized bottom via a 1-minute double bottom and 4-hour superstack condition before the NASDAQ stabilized.
- Multi-timeframe technical landscape: NASDAQ 12-hour falling wedge is still intact pending follow-through tomorrow, while S&P 500 risks losing its weekly EMA 12.
- Macro asset observations: The US Dollar staged a solid daily double-bottom bounce threatening risk assets, while Gold, Silver, and Miners are setting up for potential weekly higher low plays.
Unique Contrarian Opinions
"FOMC announcement day price action is mostly coin-flip noise that 95% of active traders should completely avoid trading; institutional repositioning only manifests on Thursday and Friday."
Credibility: 4/5Rationale: Empirically supported by market microstructure dynamics, where institutional funds spread massive liquidity deployment across multiple sessions following major macro announcements rather than executing immediately into illiquid spreads.
"Talk of a broader market bear market is completely premature, as the S&P 500 can drop over 16% from current levels before even threatening its monthly uptrend."
Credibility: 5/5Rationale: Objectively verifiable on long-term monthly technical charts, where key swing low pivot supports sit significantly below current trading levels.
- →Thursday and Friday market price action to validate the true post-FOMC institutional positioning
- →Confirmation or negation of the NASDAQ 12-hour falling wedge on the daily close
- !A failure of the NASDAQ falling wedge leading to breakdown and extended daily/weekly consolidation
- !S&P 500 closing below weekly EMA 12, shifting broader market structure from bull control to neutral/bearish weekly lower highs