September 18, 2023

Markets:

S&P 500 futures ticked down Monday morning as investors look toward the Federal Reserve’s next policy decision.

The S&P 500 and the Nasdaq both ended the previous trading week in the red, marking their second straight week of losses. The Dow managed to end the week 0.1% higher. 

Investors are widely anticipating that the Fed will hold interest rates steady at the policy meeting this week. Traders will try get a better sense of the central bank’s stance on inflation from here. 

Traders are assigning a 99% chance that the Fed stays put when it releases its rate decision on Wednesday and just a 31% probability of a hike in November, according to the CME Group’s FedWatch tool, which gauges pricing in the fed funds futures market.

Recent inflation data came largely in-line with economists’ expectations. While the producer price index gained more than expected, the core PPI, which excludes food and energy, matched the estimate. The core consumer price index also increased slightly higher than expected in August, rising 0.3% month-over-month, against the estimate of 0.2%.

Policymakers will be looking toward more economic data releases Monday. The National Association of Home Builders will be releasing September’s Housing Market Index data. The New York Fed will also be announcing September’s Business Leaders Survey results.

Portfolio:

We enter the new trading week holding setups in RIG, UPST, ATEN, and WW.  It's Fed week, so we expect swings and are anxiously awaiting trend lines and to see where we can bounce or break a bit.  Everyone knows we love season trades, historically, 9/20 – 9/30 has been a bit of a rough pathc for the S&P and markets.  This year has proven to be the opposite of what most expect, so would anyone be surprised if we ran higher?  But again, it's all about the Fed now this week.  We have strong data points on how we trade during Fed week and there's been clear patterns.  Be pateinet and ready to expose a few quick hitting opportunities should this materalize as think it may.  Let's have a strong week and continue this monster period we're in.