ES Morning Update May 2nd 2022

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Another big sell off on Friday but the 4101 low is still intact. This morning we see a lot of nothing... just chop, which I think will continue into the FOMC this Wednesday. After that the market will decide on whether it's going to continue down lower with a possible crash or reverse and go back up big with new highs on tap.

I still think the evidence (clues that I've mentioned in prior posts) supports the bulls. I've yet to see the Fed be the cause of any crash. Flash Crash... sure, but not anything real one. So I don't think they will start now. Plus most of the prior times in the past, (since the Fed came on the scene in a big way around 2009), the meetings that had the market in a correction going into them reversed back out of it afterwards.

Now everyone knows that the 50 point rate hike for this meeting is already "baked in" the market right now, so that's not going to affect the market. What it wants to know is about the future rate hikes, and I still think the Fed will calm down on them and schedule fewer hikes then previously forecasted. If so, that will be the spark to end this correction and start a move up.

The fuel to keep it going will be the shorts and the new shorts that will keep trying to pick tops as we go up. Anyway, not much to add today. I expect a whole lot of nothing as we wait on the Fed. Have a blessed day.

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