The market rallied yesterday on some rumors and possible buying infront of the Fed meeting. At this point it now becomes a waiting game till that annocunment. The census is Fed says QE3 is on the market go higher, they say No QE the market tanks. Rarely does the market do what everyone thinks.
SPY hit resistance at 135.97 and climbed above it but closed below it. SPY also bounced near support of 134.26. Again these key levels remain the key to the market’s next move. The failure above 136 is something to note, the bulls had a very bullish day yesterday but towards the end of the day, selling pressure got to the bulls. Keep this in mind if SPY does get back to this level today. If there is another failure at this level, it will be hard for the bulls to regain it.
SPY did move yesterday but other market indicators remained netural, as if they were waiting for the Fed today.
VIX: Dropped to 18 and a key support level. If VIX drops below this level it is bullish for the market so watch 17.84
Dollar(DX): With the Fed announcement coming it either means more dollars or less. DX has held support at 81.48-81.40. A bounce of this level is potential bearish for the market, a move lower and the market can rally.