Yesterday's movements continue today, traders waiting for the FOMC statement

Market Review

Yesterday’s movement in the market was contained by to two things; the USD on the back of lower than expected durable goods orders, and the Nasdaq on the back of speculation that Alibaba and Apple would embark on a partnership. The S&P was range bound till the evening when it moved upwards to continue the trend and catch up with the Nasdaq, as well as traders positioning themselves ahead of tonight's FOMC. In terms of strategy entries, the EURUSD was obtained, although closed only a few ticks onside at the cut off time 1700BST; and no other strategy entry was obtained. Crude oil closed marginally higher, although the prudent entry point was not obtained.

Today's Fundamental View

This morning has been range bound, in line with yesterday’s movement. Considering the lack of data and the upcoming FOMC statement release this evening we are unlikely to have much market action, with the exception of a few traders positioning themselves before Janet Yellen’s paper hits the market at 18:00GMT. Facebook earnings may weigh on the Nasdaq as the company is down 10% pre market, although this seems to be the trend with social media companies this season as we saw with Twitter yesterday. Earnings were stellar, but as the new CFO and Mark Zuckerberg both warned on next year may see lower profit margins as the company will have a higher investment rate than earlier. Although the market is sending the stock lower, it does not change our outlook on the company which we see being the only one to have the potential to challenge Google at the throne in Silicon Valley’s advertising industry; which coincidentally is one of the areas we see the company investing in. The recent slump and potential continuation of this should give investors a much needed new chance to position themselves in the company. The release of Department of Energy numbers this afternoon would normally create some volatility in crude, although this afternoon's numbers are likely to be fairly in line with expectations, as suggested by the API numbers released last night. Although there has been a bounce in crude from the test of the $80 handle, we remain bearish for the session, going with the long term trend. On the monthly chart however we will be guilty of shorting a support level. The strategy will be trend-following on all markets, which means our only long strategies will be in equities.

Alternative View

Traders should remain wary and informed of any geo-political risk events that may develop as the day progresses. If the positive European sentiment continues it may invalidate our short EURUSD strategy.