Outlook 12/17: Stock futures fall Tuesday as traders await the Federal Reserve’s next rate decision. Federal Reserve policymaking will be in the spotlight this week, with the U.S. central bank wrapping up its final meeting of the year. The FOMC already cut rates twice since it made a highly anticipated U-turn in September, and nearly everyone is expecting one final cut at the gathering on Wednesday. Traders are pricing in a 95% chance of a quarter-point cut. That would bring the Fed's benchmark rate to a range of 4.25%-4.5%, or a full percentage point below the four-decade high reached in July 2023, though things have also grown more complicated when sizing up the current monetary policy equation.
ESH25 (MAR2025): YVAH 6156 YPOC 6154 YVAL 6141 GAP 6149.25
/ES Plan: Yesterday market closed bullish, but overnight looks more bearish, moving below previous value, so these're the opening and initial balance options for current session:
A) If market moves above ONL 6125 with bullish internals, buy towards YVAL 6141 GAP 6149 YVAH 6156 and YHOD 6164.
B) If market moves below ONL 6125 with bearish internals, sell towards YLOD 6121 HVE 6108 and GAP 6088 magnet.
Note:
Rollover day. Pace of the Roll is around 60%. I'm quoting /ESH25 (Mar 2025) due to March volume is higher than December contract. Usually rollover days show big divergences between Stocks vs. Futures, so try to play these days on defensive mode. Setups that usually work well, may fail completely.
Market opens below value and if it begins to trade within value, VAR comes into play. Overnight inventory is bearish. The expected action is a counter-auction; failure to see the counter-auction would be an indication of potential bullish trend day.
Market Movers
10:00 AM Business Inventories
10:00 AM Housing Market Index
01:00 PM 20-Year Bond Auction
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