Whole Lotta Nothin’

S&P500 daily at end of day

End of Day Update:

Stocks failed to hold yesterday’s gains following disappointing GDP that revealed first quarter growth was practically nonexistent. Volatility was compounded by the Fed’s afternoon policy statement. Despite these headlines and a surge in volume, we traded inside yesterday’s intraday range as the market continues searching for direction.

If anyone was surprised by this lack of a reaction to the Fed’s policy statement, they should read last night’s post explaining why it wasn’t a big deal. While there was a plethora of headlines to digest today, most bulls and bears stubbornly held their prior outlook. When no one changes their mind, prices stay where they are and is why we ended pretty much where we started.

So where do we go from here? We’re near the upper end of 2015’s trading range. Either we bump our head on the ceiling again, or finally break through and start the next rally leg. The dig against the uptrend’s continuation is while we recently set new highs, they failed to trigger wave of breakout buying and short-covering. If we were poised to explode higher, it would have happened by now. Eliminating “up” leaves us with down or sideways. Either way, expect near-term weakness as we slip back into the trading range. The difference will come later when we test support and either bounce, or not. Aggressive traders can lay on a near-term short, but collect profits early and often because this choppy market takes profits back as quickly as it gives them.

Jani

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