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Two Ways To Play: Ahead of the Fed

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Strengthen your portfolio in good times and bad.

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FOMC Day

It's a historic day on Wall Street as the Federal Open Market Committee meets and announces its rate decision. The Federal Reserve is widely expected to cut its benchmark interest rate to the lowest level in its 94 year history.

In data provided by Bloomberg this morning, Fed funds futures are pricing in a 64% chance for a 75 basis point cut to 0.25% and a 36% chance for a 50 basis point move to 0.50%. Some are also expecting the central bank to give any signs that it could attempt to jumpstart credit by further enlarging its balance sheet which has grown to over $2 trillion worth of assets.

For more, see Professor Kevin Depew's Five Things You Need To Know.

From the Bull Pen: The message in gold stocks is loud and clear with a one week 20% move. Bulls can continue to play the gold miners ETF (GDX), A tight sell stop can be set near $29.

From the Bear Cave: Bears looking for a play can consider Exxon Mobil (XOM). The stock is approaching significant resistance at its 200 DMA ($82). One option is to initiate a starter position if and when it reaches that level.


Quick Check Around the World

Asian trading closed with the Hang Seng 0.55%, Nikkei -1.12%, Sensex 1.47%, Taiwan 0.07% and Shanghai 0.54%.

Glancing towards Europe, we see the CAC 1.04%, DAX 1.88%, FTSE 0.94%

As of 8:20 a.m. EST, S&P futures are trading +6 to 878, and Nasdaq futures are +8 to 1203.

A Look At Commodities

Crude oil
is trading +0.84 to 45.35. Gold is -3.80 to 831.60. Silver is +0.390 to 10.589, and copper is -0.750 to 137.75.

The dollar index is -0.280 to 81.990.


On the Radar

Economics

08:30 Consumer Price Index (MoM)
08:30 CPI Ex Food & Energy (MoM)
08:30 Consumer Price Index (YoY)
08:30 CPI Ex Food & Energy (YoY)
08:30 Housing Starts
08:30 CPI Core Index
08:30 Building Permits
08:30 Consumer Price Index
02:15 U.S. Federal Reserve Open Market Committee Meeting
02:15 FOMC Rate Decision

Click here for the full trading radar.

Good luck today!
Position in GDX

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

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