Jerry Samet
12-14-2022, 06:28 PM
The market was volatile today, to say the least. There was early strength going in to the Fed report. The major averages rallied to solid gains before the announcement , but sold off when the commentary was more hawkish than expected. The early gains were quickly lost and turned to solid losses. The market bounced around before closing with moderate losses. All the major averages finished in the lower half of their intraday trading ranges. The COMPQ and the NDX fell .76% and .79% respectively. The SPX declined .61%. Volume was lower across the board after yesterday’s very heavy volume. Leading stocks were lower as well with the leaders index losing 1.65% on the day. The index closed in about the middle of its trading range and remained below its important 50dma. Volume was very high as a couple of components had unusually high volume. The market rallied early in anticipation of a friendly Fed announcement. The 50 basis point hike occurred but the wording of the announcement pointed to a higher terminal rate and little chance of rate cuts next year. Selling came in and the market closed weak. Leading stocks continued to underperform the overall market as can be seen in the weakness of the relative strength line of the leaders index. The SPX continued below its 200dma. The market continued its pattern of rising only to be knocked back down. It’s a very difficult market right now and worthwhile gains are hard to come by. A sizable cash position is a good idea. Jerry