News Alert: The FOMC left rates unchanged and changed their language to a more tame take on future interest rate hikes. As a result, the market is spiking higher going into the last 90 minutes of trading. All I can say is, "look out," the market is overbought and sentiment has its icing on the cake with this "good news." Still, with a holiday coming up it is important to wait for price weakness before buying any more puts. SPY Support The SPY Trend Model is setting out support levels on multiple time frames: On the Daily chart support comes in at 454.00, while on the shorter-term oriented 240 minute chart support is at 459.00. With an important FOMC news spiking the market into the close and RSI at major overbought levels (see chart below), be ready for a reversal of fortune for the indices. A drop below SPY 454.00 will likely be a trigger to a much deeper decline. SPY - Daily Trend Model SPY - 240 Minute Trend Model A SPY decline below 459 (aggressive) and then 454 will get us active again on the Short side. Going into the last hour of trading look for an FOMC led rally, or decline into the close. If the latter, buy SPY Puts on breakdowns below 459-454 as per risk tolerance. SPY Jan 19th Puts DJI - RSI Tops One of the classic market top indicators, RSI, is speaking loud and clear. It's only a matter of time before market responds. Guest Chart: DJI
