FedSpeak Review 8/26/2016

  Jackson Hole, Wyoming.

  The Federal Reserve is inching closer to raising interest rates again. 
Fed Chairperson  Janet Yellen told a global monetary policy conference that the case for a rate increase had grown stronger, while Fed Vice Chair Stanley Fischer suggested a move could come at the central bank’s September policy meeting “if ” the economy was doing well.
U.S. government data published earlier on Friday showed the economy growing at a  sluggish  1.1 percent in the second quarter.   Ms. J. Yellen said a lot of new jobs were being created and economic growth would likely continue at a moderate pace, quote:   “I believe the case for an increase in the federal funds rate has strengthened in recent months.”
Ms. J.  Yellen said the Fed already thinks it is close to meeting its goals of maximum employment and stable prices, and she described consumer spending as “solid” while noting business investment was weak and exports had been hurt by a strong U.S. dollar.
Ms. J.  Yellen did not give guidance on what the central bank needs to see before raising rates.

Attempts to analyze what the FED is thinking … leads anyone doing their own homework  to their own answers … but, provides little to no insight as to what the Fed might actually do.  That said, one can analyze what Mr. & Ms. Fickle Markets is actually doing in relation to Fed speeches, public statements, and comments.

Friday 8/19/2016 was more about 3rd Friday of the month options expiry than it was about Nervous Nellie concerns regarding the 10 A.M. ET Friday 8/26/2016 speech by analyze what the FED is thinking.   That said this is what the S&P 500 did over this timeframe:

 

dji-nas-spx %c20160826d

Chart #1  (above, EOD, %change)  The above DJIA, Nasdaq, S&P 500, Daily Index chart reflects the percentage change since the first markets’ correction 8/21/2015.  Note:  EOD= End of Day
             ——————–

S&P 500 (INDEX SPX: .INX)
Date, Open, High, Low, Close, Vol, Change, %Change

  • 8/19/2016 2184.24 2185 2175.13 2183.87  580186480 (3.150) (0.144)
  • 8/22/2016 2181.58 2185.15 2175.96 2182.64  463033593 (1.230) (0.056)
  • 8/23/2016 2187.81 2193.42 2186.80 2186.90  466731170 +4.260 +0.195
  • 8/24/2016 2185.09 2186.66 2171.25 2175.44  472264903 (11.460) (0.524)
  • 8/25/2016 2173.29 2179 2169.74 2172.47  459398340 (2.970) (0.137)
  • 8/26/2016 2175.10 2187.94 2160.39 2169.04  494425690 (3.430) (0.158)

Five down days and only 1 up day (Tuesday, 8/23/2016)

… this is what the S&P 500 Volatility did over this same timeframe:

 

vix %c20160826d

Chart #2  (above, EOD, %change)  The above Volatility S&P500 (INDEX CBOE: VIX), daily Index chart reflects the percentage change since the first markets’ correction 8/21/2015.
                       ————————-

Volatility S&P 500 (INDEX CBOE: VIX) (TVIX, XIV)
Date, Open, High, Low, Close, Vol, Change, %Change

  • 8/19/2016 11.67 12.28 11.33 11.34 –  (0.090) (0.787)
  • 8/22/2016 12.53 13.02 11.94 12.27 –  0.930 8.201
  • 8/23/2016 12.15 12.44 11.72 12.38 –  0.110 0.896
  • 8/24/2016 12.70 14.01 12.30 13.45 –  1.070 8.643
  • 8/25/2016 13.62 14.09 13.29 13.63 –  0.180 1.338
  • 8/26/2016 13.54 14.93 12.13 13.65 –  0.020 0.147

 

These blogs contain the Supports, Resistances, Pivot Points, “projected” highs and lows and more … and should be kept in mind as the next Fed meeting is only weeks away.

… more to follow ….

 

 

 

 

 

 

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