That was some rough reception to no rate cut and arguable guidance on cut bias. Just after your close at about 02:00 ET, the US futures got a fast bump out of their sideways range on news that Liu He was heading to DC at the end of the week.
The US markets are down substantially today and VIX is up over 35% at one point and settling up +25% at 19.32, just below the storied 20 handle. SPX closed at 2884.05 or -1.65% after spending a few hours at -2%. The index made a typical eod recovery effort from 2862 which is less than ten points from the top of 1 April gap that starts at 2840. There was a substantial amount of weekly hedging at SPX 2850 and that needs watching as it could shift tomorrow. The ES profile is again quite long today. Yesterday's breadth did not support the bounce as NYSE A-D lines were below neutral for the whole session. You can imagine what today's breadth looks like but I will show you anyway. Another factor that was true to intentions was the Yen pairs. I would call the US Treasury response less than severe with the 2-year down three basis points to 2.28% and the 10-year down 5 bps to 2.45% and that bears watching.
A quick note on the interplay of techincals and external macro or geopolitical factors: That weak structure under 2890 is there to be taken. It can be sort of hard to get our heads around the collision of techincals with fundamentals but today could be an example.
@48&34 that seems a wise choice and thanks for reading and discussing even though you are not trading short term. With the VIX up substantially on Monday and again today and a bunch of margin for the trade war people to play with, we can at least assume the potential for heightened volatility. I should have said that short covering contributed to Monday's rth (regular trading hours) bounce. You can see by @VVX565's update that breadth was weak and the NYSE A-D lines did not get above the neutral line. Traders will watch breadth carefully tomorrow.
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