..duck flying shoes, maybe...but GS, GE, FED

..all in one day for the market?

A quick round- up into the trading day(s) before all the shoe throwing begins.   The question is how will the market react to the plethora of news events starting in the premkt and lasting long into the week.   As far as today’s trade,  it was mostly a sitting on your hands kind of market before tomorrow.   This was no surprise as quiet days are pretty well the norm ahead of `big` catalysts.   Crude-commodities continued to outperform early on dollar weakness, but crude swung $6 later in the day and was the main reason for the weaker market.   We highlighted shipping  names going into the day on news of a revival/ charter prices up threefold in a week and they held their own most of the day after gapping ~15%.   CMP,  we tossed out again and it caught about 3 points afterwards,  if we get a good market we expect more from this chem play as mother nature is starting to play havoc this winter.   On the technical side,  we put a lot of emphasis last week on bounces from 850-860 on the SPX.   It seemed we got program trading kicking in around 330pm today as the SPX spiked from ~850.    So, support seems to be here.   This was the only glimpse of institutional trading all day, it was mostly a sitting and waiting game all day.

GS,  earnings are on the mound first and all eyes will be set here.  CC at 11am.   The immediate trading action will be something to behold with wild fluctuations that will continue into the first hours of the regular trading day.   The reaction is what we’re all waiting for as it will signal if the market is truly looking forward.   The financials again were one of the weakest groups today and have been on sale since they peaked on December 8th.   GS, like many other brokerage stocks have had ½ of their gains wiped away since the rally started Nov 21.   If the market wants to react favourably, it can cook in any bad earnings outlook into these 50% declines in the past week and move forward! .

GE’ s, full outlook is tomorrow as well and it’s being ignored with GS, FED taking the headlines,  but it can carry a big stick to the markets direction.

FED  decision is in the afternoon and you have to expect the volatility to continue afterwards.   The FED has been aggressive over the financial crisis and a reasonable chance exits we go to zero..ZIRP,  but it is more likely a 50bp ease step 1 to ZIRP taking place later.   The statement will be scrutinized and we’ll likely hear again the FED has sufficient tools at it’s disposal to achieve it’s goals and nothing more.

If this wasn’t enough,  we have lots more market moving possibilities to deal with later in the week.  We’ll save those for later.   Tomorrow’s approach has to centre around the SPX and the levels of importance (Resistance /Support).    Which direction we trade will be focused around these important levels.   Don’t hurt yourself analyzing GS, FED reports, the market will lead you in either direction.   It’s going to be an interesting day.