This report is late posting because of the Fed's monetary rate decision report at 2 pm.
Briefly, the US market (SP500) shot up and beyond R2 (2023) from S1 (2009) after the minutes were published. $VIX fell to 15, WTI crude remained steady at $38, the US dollar fell sharply to the low 96's and gold rose from 1229 to 1246. As usual the markets after a brief exaggerated run-up are sliding back down to where they were BEFORE the report.
Here is the current market situation from CNN Money
North and South American markets are broadly higher today with shares in U.S. leading the region. The S&P 500 is up 2.26% while Brazil's Bovespa is up 0.46% and Mexico's IPC is up 0.35%.
WASHINGTON, March 16 (Reuters) - The Federal Reserve held interest rates steady on Wednesday, but indicated that moderate U.S. economic growth and "strong job gains" would allow it to resume tightening monetary policy this year.
BRUSSELS/DUBLIN - European Union antitrust regulators have asked Ireland to provide further details on the country's tax deal with Apple before deciding whether this constitutes illegal state aid to the iPhone maker.
WASHINGTON (Reuters) - Underlying U.S. inflation increased more than expected in February as rents and medical costs maintained their upward trend, which could keep the Federal Reserve on course to gradually raise interest rates this year.
NEW YORK (Reuters) - Sabrina Callin, managing director and head of equity product management at Pacific Investment Management Co, has decided to retire from the firm in the second quarter, Pimco said on Wednesday.
NEW YORK (Reuters) - Oil prices rose about 4 percent on Wednesday, resuming their rally from a two-day slide, after major oil producers firmed up plans to meet in Qatar to discuss an output freeze and as U.S. crude stockpiles grew less than expected and gasoline demand soared.
WASHINGTON (Reuters) - Major automakers will announce Thursday they have agreed to install automatic emergency braking systems in nearly all U.S. vehicles by September 2022, three sources briefed on the plans said.
With the market already pricing in dramatically fewer rate-hikes that the "cheerleading" Fed, Deutsche Bank expects the USD to respond favorably to the FOMC's signals on Wednesday, contrary to the pattern seen after the last four FOMC meetings with press conferences.
The waning influence of the Fed's projections is showing up in derivatives markets. After the December revision to the projected path of interest rates, traders responded much less than they did earlier in the year in the market for derivatives known as overnight-indexed swaps.
But, as Deutsche's Alan Ruskin notes, the likely comment on the balance of risks will be one indication that all upcoming FOMC meetings are "live." Among the conundrums facing the Fed, are how much weight to place in the predictive powers of the past (USD led) tightening in financial conditions; and the signal from a flatter yield curve...
Table 1 shows how FX and bond markets have typically registered much larger (absolute) one day price changes on days when FOMC's end with a press conference than when they don't. These FOMC press conference daily moves also vastly exceed the sustained reaction on payroll days. The reasons are not hard to find - FOMC days with press conferences, have the Fed Chair Q&A, as well as the economic projections and the notorious dot plot to respond to.
Market breadth momentum contonues to weaken as the S&P 500 grinds higher, setting up a bearish outcome similar to the early November 2015 top. As BofAML's Stephen Suttmeier warns a break below channel support at 1989 would signal an interim top.
The NYSE McClellan Oscillator is a breadth indicator that shows a negative divergence with price action. This indicator showed a bearish divergence with the S&P 500 from early October to early November that preceded the early November break below the rising channel from early October. This ended the rally off the late September low and was confirmed by a loss of the late August uptrend line in the McClellan Oscillator.
The pattern in mid-March is eerily similar to early November, as the McClellan Oscillator shows a bearish divergence with the S&P 500 grinding higher within the rising channel from February. A break below channel support at 1989 (rises ~6.54 points/session) and the late January uptrend line on the McClellan Oscillator could be the signal for an interim top in the S&P 500. Channel resistance is 2061.
"Sooner or later, everybody sits down to a banquet of consequences"
- Robert Louis Stevenson
Gordon Brown, back when he was the UK Chancellor of the Exchequer, distinguished himself by selling off approximately one-half of Great Britain's gold reserves at what turned out to be a near-bottom at the end of the secular bear market in gold which lasted from 1980 to 2000-ish. He will probably be remembered for this more than anything else he ever did, even as Prime Minister. He'll be somewhat of a laughing stock because of it (gold now, even after a vicious near 5-year cyclical bear, worth a paltry 300% to 400% more than what England garnered from it's sales). That chapter among those who pay attention to this sort of thing is affably called "The Brown Bottom".
Two events recently converged in the news to create an analogous moment here in Canada:
1) the news that the new Finance Minister Bill Morneau has completed selling all remaining Government of Canada gold reserves. Canada, the 5th largest gold producer in the world, ...
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