Warsh Takes Starch Out.
Daily plan 6.18.26
So the Warsh presser did not go that well for the risk on sentiment.
Notably, the new FED Chair decided it is time to suspend forward guidance altogether and half the members on committee leaned hawkish.
The key level which was resistance was a good high today and we were not at all able to peek above it. Worrisome is the fact that while technically we closed back above 7500, we not only did quite a bit of trading below it and the bounce was sort of shallow.
While the presser was widely seen as impending rate hikes, I think this may not happen. I do not think the FED is in a position to do rate hikes due to the staggering cost of debt servicing cost, but at the same time I think there is risk that they will jawbone to kill risk on assets to naturally lower rate of surges in producer and consumer prices.
What we need to do here is see this market hold 7500 thru this week which is a positive sign. Note that the stocks are closed for business on Friday but futures will trade.
We can lean on 7530-7540 as an important level on the session tomorrow. Unless overcome this can be resistance for push lower to test the lows from today.
The bulls will want us to remain here above 7500 and then close a daily or week above 7540 to signal worst of sell off is behind us, else this thing can get legs.
We last traded 7520is at time of this post.
~ tic
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