For the duration of my trading career, there have been several constants. One of them has been the Federal Reserve meetings. These meetings are typically held several times a year and when they conclude, we find out if there is any change in interest rate policy much less guidance from the Fed. Sometimes the meetings go for one day and sometimes they go for two days. But the steady tenet is that the results have been released at or around 2:15PM on days of the policy meetings. There has historically been much talk about the policy leading up to the meeting with the market active in the morning, dull in the hours leading up to the announcement, and traditionally much more active just after 2:15 as things are digested. This all changes today. There is going to be a brand new process with a post-statement briefing for the first time in FOMC results history. Thus, the statement will be released today at 12:30 followed by a briefing at 2:15. The seven year note auction- usually occurring at 1PM- will instead take place at 11:30AM. So, we are in uncharted waters. There still be speculation as to Fedspeak. There still will be a busy morning. But the window of slowness will likely shorten from 10:30ish to 2:15ish down to 12:30. After that, there will be a reaction to the number followed by a rapid quieting as traders await the press conference. From there, nothing and anything can happen depending on the length of the conference and the type of question asked (“do you anticipate doing a QE3, et al?”). This day will have a different kind of feel to it with the first-time schematic; adjust your lunch much your trading day accordingly.
Markets in Asia were mixed overnight with Tokyo up 1.4.% but Hong Kong Down 0.5%. markets in Europe are positive across the board from 0.2% in London to 0.8% in Frankfurt. The dollar is notably stronger against the yen amid rumors of a Japanese debt downgrade. Gold and oil are both slightly ahead. Futures are mildly positive. Mortgage Application data already came out, Durable Goods (2.0%) are due out at 8:30AM and then the Fed Show takes over. Look for a very busy morning amid all of the earnings flow followed by slowness as nobody knows exactly what to expect today. There will likely be a flurry of action just after the Fed announcement at 12:30 and then be ready for anything during the initial briefing. The focus will be on all of the earnings plays, rare earths and then financials and techs during the Fed periods.
If the whole story is not there -
If something is good, assume either a short thru unchanged or an A-B-A2 (preferably to the downside in a downside market and the upside in an upside market) based on direction of the market unless specified.
If something is bad, assume either a buy thru unchanged or an A-B-A2 (preferably to the downside in a downside market and the upside in an upside market) based on direction of the market unless specified-
Good- The following stocks have good news and/or a strong technical pattern
IIVI- closed near a high after posting great earnings
MMM- closed near a high after posting decent earnings
KND- closed near a high after posting good earnings
REDF- closed near a high after announcing a group deals service in 40 Indian cities
WTI- closed near a high after posting good earnings
CSL- closed near a high after posting good earnings
LO- closed near a high after posting good earnings
CMI- closed near a high after posting good earnings
ASH- closed near a high after posting good earnings
GRA- closed near a high after posting good earnings
AAN- closed near a high after posting good earnings
ITW- closed near a high after posting good earnings
REGN- colon cancer treatment met goal in study
BDX- decent earnings
ALTR- decent earnings
BWLD- good earnings
DV- decent earnings
PNRA- decent earnings
SIMG- decent earnings
UHS- decent earnings
FORM- decent earnings
QCOR- decent earnings
KEYN- decent earnings
VSI- decent earnings
HUSA- decent earnings
ABX- decent earnings
BP- decent earnings
MWV- decent earnings
ROC- decent earnings
ARMH- decent earnings
BA- decent earnings
BHI- decent earnings
EDU- decent earnings
GLW- decent earnings
HES- decent earnings
JNY- decent earnings
MCO- decent earnings
ROK- decent earnings
TUP- decent earnings
WHR- decent earnings
WLP- decent earnings
ARW- decent earnings
SVVS- received takeover bid from CTL for $40/share- $30/cash and $10 in CTL stocks
Bad-The following stocks have bad news and/or a weak technical pattern
NFLX- closed near a low after posting terrible earnings
UIS- closed near a low after posting terrible earnings
X- closed near a low after posting bad earnings
UA- closed near a low after posting terrible earnings
RCII- closed near a low after posting terrible earnings
TZOO- closed near a low amid a report that Facebook will be entering the daily deals space
AAPL- closed near a low
ABX- closed near a low
VHC- closed near a low
AMZN- poor earnings
APKT- poor earnings
BRCM- terrible earnings
CBI- poor earnings
RKT- poor earnings
SWK- poor earnings
WU- poor earnings
FTI- poor earnings
LIFE- poor earnings
NBR- poor earnings
CHRW- poor earnings
PPDI- poor earnings
STM- poor earnings
SMCI- poor earnings
MIPS- bad earnings
LDK- bad earnings
SFSF- bad earnings
PFCB- poor earnings
ROK- poor earnings
YOKU- downgraded by GS
NXY- poor earnings
RGS- poor earnings
WPI- poor earnings
COP- poor earnings
Earnings:
WED APR 27 BEFORE
ABX ARMH ARW
ATI BA BHI
BP CIT COP
DPS EAT EDU
EXC GD GLW
GT HES HL
JNY LAZ MCO
MPEL MWV NOC
NOV NXY OC
OXPS PFCB PH
PX RGS ROC
ROK SEE TMO
TUP WHR WLP
WPI
WED APR 27 AFTER
AFL AKAM ALL
BIDU CCI COG
CTXS CYH EBAY
EFX EQIX EQR
EXXI FISV FLEX
FLS GMCR IDCC
ISIL LNC NSC
NVLS OII OIS
ORLY OTEX PMTC
RE RYL SBUX
SGEN SLG SPN
TER TRN VAR
WLL XLNX
Epiphany Trading, LLC
www.epiphanytrading.com
Erik R. Kolodny- Chief Markets Strategist
Brendan P. Byrne- President
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