OVERVIEW
Markets Will Likely Chop All Day

🟥 Risk-Off: Equities are bracing for today’s FOMC decision. Despite some strength, breadth remains overextended in the short term, and many stocks are digesting recent gains.

🕰️ FOMC Decision: A no-rate-change decision is still expected, but Powell’s tone and forward guidance will be the key wildcard. Traders will be on edge for clues on future rate policy and his stance on current economic conditions.

🌏 U.S.-China Talks: Headlines around improved trade relations have sparked some optimism, though meaningful progress remains uncertain.

MARKET ANALYSIS
A Trap For The Impulsive & Overconfident

Markets are holding up well, but under the surface, traders are bracing for volatility around tomorrow’s FOMC decision. The Fed is widely expected to hold rates steady — but the real risk lies in Powell’s post-decision press conference, especially with political pressure heating up.

Last week, Trump openly criticized Powell, saying his “termination cannot come fast enough.” The White House later walked that back, but the message landed. While global markets have mostly shrugged it off, the episode highlights how politically charged this Fed backdrop has become — especially in an election year.

Meanwhile, headlines are surfacing around potential progress in U.S.–China trade talks, sparking some optimism. Trump has teased an “earth-shattering” announcement in the coming days, though details remain scarce. Treasury Secretary Scott Bessent and trade envoy Jamieson Greer are meeting with Chinese officials this week in Switzerland — but expectations for real progress are still low.

💡 Key takeaway: Risk appetite is still steadily rising — but it’s fragile. This is classic pre-FOMC indecision combined with macro uncertainty.

Nasdaq

• The Nasdaq pulled back intraday yesterday on higher relative volume — a notable shift. But despite the uptick in activity, QQQ held its ground: price closed right on its point of control (POC) and bounced off the rising 200-day EMA. That’s classic pre-FOMC indecision — elevated volume, intraday chop, and then a strong close.

• Many of the most extended names — especially in tech and AI — saw profit-taking after a multi-week run. But crucially, the pullbacks found support at rising 10-day and 20-day EMAs across much of the leadership group. That’s not weakness — that’s digestion.

• Breadth remains strong, with over 86% of Nasdaq components above their 20-day EMAs. But when participation is this broad, new entries become riskier. Chasing now means you’re late to the move. Better to wait for tight setups to re-emerge — likely after today’s Fed decision sparks the next directional move.

S&P 400 Midcap

• The midcaps are testing key technical levels, holding steady near their Point of Control (POC), which has acted as solid support. Currently, the POC, along with the rising 10-EMA on the weekly chart at $528.50, is providing a buffer against further downside. There’s significant technical support here, with the POC and both the daily and weekly EMAs in alignment, suggesting the potential for stabilization at these levels.

• However, the midcaps remain in a holding pattern. Overhead resistance continues to be a concern, particularly with dense supply near the 200-day EMA at $546, aligning with the declining weekly 20- and 50-day EMAs. This range will need a catalyst to trigger the momentum needed for a breakout.

• For now, expect digestion, as the low relative volume seen yesterday suggests a pause rather than a panic. The retracement didn’t raise concerns, as it was on lower volume, which is typical during a consolidation phase. But, as always, macro events — especially the FOMC meeting — could change the technical picture rapidly, and we may see volatility pick up once the news is digested.

Russell 2000

• The small caps (IWM) saw a spike in relative volume yesterday as the Point of Control (POC) was rejected for the third time, pushing the index to test its rising 10-EMA. While a bounce occurred, it wasn’t particularly strong or convincing.

• A clear resistance level has now formed, stemming from the breakdown that started in late February 2025. With this in mind, we expect continued underperformance for the IWM moving forward, as small-cap exposure isn’t drawing much interest right now.

• However, this could change quickly if we see an aggressively positive reaction to today’s FOMC decision. In a growth market with money flowing into equities, these names—due to their high volatility—stand to make the biggest percentage gains.

🧠 Mindset Check: Intraday Noise ≠ Signal

Once you’re in, intraday noise doesn’t matter unless it breaks your structure. Traders lose edge by reacting to every wiggle; institutions don’t.

Here’s the hierarchy:

1. Intraday price action: noise

2. Closing price: signal

3. A multi-day trend: truth

Why? Because real size operates on daily and weekly timeframes. They accumulate into weakness, distribute into strength, and they defend key levels — but only if the trend justifies it.

That’s why they’re called the smart money — because they wait for structure and confirm through price and volume. And they call us the dumb money — because we panic on a red candle at 10:14 AM.

What matters post-entry:

• Did price close above the prior day’s high or a key pivot? → That’s strength.

• Is volume expanding into a move or drying up into resistance? → That’s commitment.

• Is the trend structure (10/20-EMA) rising and are you trading in sync? → That’s momentum.

Midday lows are manufactured to shake out weak hands. Ignore them. Your edge is in interpreting where the market lands, not how it panics midday.

Remember: You’re not paid to guess what Powell or Trump will say or how people will react. You’re paid to recognize the dislocation after it happens — when price & volume confirms it.

FOCUSED STOCK
OKLO: Oklo Inc.

• Oklo Inc. shares are up after Axios reported that the White House is preparing executive orders to fast-track nuclear reactor deployment. This directly benefits Oklo, a leader in compact reactors designed for data centers, defense, and remote sites.

• The planned executive actions could bypass licensing delays at the Nuclear Regulatory Commission (NRC) by leveraging the Departments of Defense (DOD) and Energy (DOE). The DOD’s energy needs make it a key enabler of this accelerated push.

📊 Technical Snapshot: OKLO has broken through its Point of Control (POC) near $22.50. With a strong multi-month base in place, we’re watching for a breakout above $29 as the next key entry point.

⚠️ Caution: Earnings are coming up, so manage open risk carefully—volatility could spike around that event. Consider waiting for an earnings based episodic pivot.

FOCUSED SECTOR
IBIT: IShares Bitcoin Trust

• IBIT is bouncing strongly off its rising 10-EMA after a low-volume retracement coincided with a pullback in BTCUSD. The Point of Control (POC) at around $55 has now been overtaken in premarket, signaling strength.

• This offers a solid opportunity to gain exposure to the BTCUSD move with a momentum play in IBIT.

Reminder: Wait for actual confirmation of a change in trend from a contraction to a breakout—don’t just blindly jump in during the first 3 minutes.

Q&A
Have a trading question? Hit reply and ask!

Q: “How do you manage new/open trades during Fed weeks?”

Cut position size ahead of FOMC.
The first rule of volatility: uncertainty equals risk. Powell’s tone is the wildcard—emotional swings are inevitable, and the market will overreact, creating sharp movements.

Reduce risk before the unknown becomes the known by using ATR multiple extensions from the 50-EMA to determine which positions are at risk of being extended (>6-8x ATR multiple = pullback likely).

Hold off on all new naked positions until after the decision.
The first hour post-FOMC is a trap. Emotional reactions and knee-jerk market moves can create false signals.

If you're already in and the position is risk-free (with stops moved to break-even and a portion sold into strength), stay in. Always avoid initiating new positions during this chaotic window.

Remember: It’s better to be out and want in, than in and want out. Our job is not predicting price, rather riding the momentum as it comes.