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Following the Federal Open Market Committee (FOMC) statement to raise 0.25%, the equity markets went into sell mode. If we keep this in perspective, the S&P 500 has rallied over 5% in the 30 days since Donald Trump was elected on 8 November.
It could be argued that the market has moved well ahead of itself and was due for a pull back. At the close of US markets, the S&P was down 0.8%.
The two-hour S&P 500 chart below shows the 2278 high from Tuesday night, with last night unable to move higher before the FOMC decision. It is important to notice the support level of 2252 was breached last night, however the market closed above this level with only a small retest at 2253 from the inside period. The final candle of the session into the 4pm close has a high close.
The key level in tonight’s session is the 2252 support. A closing session below this level could see a further sell off to test daily support at 2218.