Pullback Ahead of Fed Decision Should Interest Traders
Here are two bigger names I'm looking to add as stocks see a thud just ahead of Jerome Powell's press conference.
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The market’s two-day bounce is ending with a thud on Tuesday morning.
The major indices have already given back Monday’s gains but are still well above last week’s lows. One exception is the Magnificent Seven MAGS, which continues to lag badly and is within a few pennies of a new low for 2025. Nasdaq 100 QQQ breadth is running 19 gainers to 82 decliners.
There are no obvious news headlines driving the pullback. This is technical action and is very broad because it is being driven by the selling of indices and ETFs rather than by individual stocks. Everything is being dumped without regard to its individual merit.
This pullback in front of the Fed policy decision on Wednesday creates a very interesting technical setup. If there is a positive response to Jerome Powell, it will produce a technical follow-through day as long as last week’s lows are not broken. If the lows hit last Thursday are breached, then the technical picture will totally change.
I’m giving my positions some room at this point, but I am not adding to anything and will take a few stops. I believe there is a good chance of a positive response to the Fed, and this shakeout makes it more likely.
Two bigger names that I’m looking to add to are Uber UBER, which is sitting right at its 200-day simple moving average, and Altria Group MO, which is a defensive play in a poor economy and pays a dividend of about 6.7%
This is a very tough market right now, and the best course of action is to have patience and lots of cash.
At the time of publication, DePorre was long UBER and MO.
