D&D Note (3.20.2018) ~ Markets Rally Ahead of FED Meeting #StockMarket #FED #RateHike ~

D&D Note (3.20.2018) ~ Markets Rally Ahead of FED Meeting ~

Will it be three will it be four? That is the major question right now and has been the theme of this year. How many FED rate hikes will we get. A large part of the recent correction was the repricing of the market with the chances of a 4th rate hike this year.

Tomorrow the FED has their first FOMC meeting under Chair Powell. A rate hike for tomorrow is 100% priced into the market. What is only now 30% priced into the market is the chances of a 4th rate hike this year. All eyes will be on the dot plots and how dovish or hawkish Powell is in the press conference.

Facebook continued to slide today along with all social media tech stocks. FB fell below its 200 day moving average but bounced off the RSI 30 level. D&D is taking the 3 day rule into effect on the stock and will asses tomorrow whether to add more back to our holding. Ideally we would prefer to see the RSI fall into actual oversold territory (under 30) before buying.

The portfolio made 3 buys at the close today as a bit of a hedge heading into tomorrows big day for the market. We added to C, DIS, and SIEGY.

If we get a dovish FED tomorrow the market should resume its upward pattern. However if we get a hawkish FED the markets should retest the February lows. For this reason D&D is staying optimistically cautious keeping larger than normal cash reserves.

Overall the markets still need to find its new leadership group. Price action in sectors will be closely watched tomorrow for hints of who are new leadership sector will be. In a rising rates environment an investor would assume Financials should become our new leadership group.

D&D movers:

– NVDA up 3.56%

– AMZN up 2.69%

– TCEHY up 2.45%

– BABA up 2.27%

– UNLRY down -5.52%

– IMLFF down -4.67%

– FB down -2.56%

– EMHTF down -2.20%

Indexes

– DOW up 0.47%

– NASDAQ up 0.27%

– S&P up 0.15%

Sector Movers:

– Energy up 0.84%

– Consumer Discretionary up 0.62%

– Industrials up 0.34%

– Telecom down -1.01%

– Utilities down -0.46%

– Consumer Staples down -0.34%

Notes

– US 2-YR 2.341% (up 0.038)

– US 10-YR 2.89% (up 0.045)

– US 30-YR 3.12% (up 0.042)

Volatility

– VIX 18.66 (down -1.89%)

Crypto (1:00 PST)

– BTC $8,939.01

– ETH $559.80

– BCH $1,061.98

– LTC $170.46

Metals

– Gold $1,310.50 down -0.55%

– Silver $16.185 down -0.86%

– Copper $3.037 down -1.46%

Energy

– Oil $63.42 up 2.16%

– Brent $67.35 up 1.97%

– Nat Gas $2.675 up 0.91%