Bulls Rebound but Volatility Remains Elevated

The stock market was choppy throughout Tuesday following a strong open and a morning fade afterwards as Wall Street turned its attention to the start of the Federal Reserve’s latest two-day monetary policy-setting meeting. The meeting minutes (on Wednesday) are expected to show the Fed is nearing the timing of its plan to begin tapering its asset-purchase program.

The rebound following the brief dip led to a mixed close with the charts showing it was basically an inside day for the major indexes. This means lower lows weren’t made from Monday’s selloff while the market struggled in recovering the previous session highs. Volatility ended lower while remaining above a key level of support.

The Nasdaq tagged a first half high of 14,847 before finishing at 14,746 (+0.2%). Near-term and lower resistance at 14,750-14,900 was cleared but held. A close above the latter the 50-day moving average would be a more bullish development with upside towards 15,000-15,150.

The Russell 2000 tested an opening high of 2,201 while ending at 2,186 (+0.2%). Key resistance at 2,200 and the 200-day moving average were cleared but held. A close above these levels would be a slightly bullish development for a retest towards 2,225-2,250 and the 50-day moving average. 

The S&P 500 closed at 4,347 (-0.1%) with the morning peak kissing 4,394. Key resistance at 4,400 was challenged but held. A move above this level would signal a return trip towards 4,425-4,450 the 50-day moving average.

The Dow tapped an intraday high of 34,313 while settling at 33,919 (-0.2%). Lower resistance at 34,250-34,500 was cleared but held. A close above the latter would suggest a near-term bottom with further strength towards 34,750-35,000 the 50-day moving average.

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ANALYST UPGRADES/DOWNGRADES

Bath & Body Works (BBWI) upgraded to Buy from Hold at Argus
Vail Resorts (MTN) upgraded to Overweight from Sector Weight at KeyBanc
Warner Music (WMG) upgraded to Outperform from Neutral at Credit Suisse

Big Lots (BIG) downgraded to Neutral from Overweight at Piper Sandler
Diana Shipping (DSX) downgraded to Neutral from Buy at BTIG
Oshkosh (OSK) downgraded to Hold from Buy at Jefferies

WEDNESDAY'S EARNINGS ANNOUNCEMENTS 
Before the open: General Mills (GIS), GSX Techedu (GOTU), Nexters (GDEV)

After the close: BlackBerry (BB), H.B. Fuller (FUL), KB Home (KBH), Steelcase (SCS), Valeo Pharma (VPHIF)

WEDNESDAY'S ECONOMIC NEWS
​MBA Mortgage Applications - 7:00am
Existing Home Sales - 10:00am
FOMC Minutes - 2:00pm

METALS/ OIL
Gold closed at $1,778.20 an ounce, up $14.40
Silver settled at $22.61  an ounce, up $0.41
Copper finished at $4.13 a pound, up $0.02
Crude Oil was at $70.51 a barrel,  down $0.39
Bitcoin Investment Trust (GBTC) ended at $33.18 down $1.38

I hope this helps you prepare for the trading day. Make it a great one!

 Todd Mitchell

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