All eyes are on the FOMC’s upcoming rate announcement and press conference today.  The slumping yield curve, buoyant 10-yr and lethargic dollar are testament to investors’ angst over the Fed’s game plan.

Is there one which can keep inflation high enough (but, not too high), prop up the US dollar, keep interest rates under control, keep the market elevated and actually improve the economy?  Not likely.  Meanwhile, politicians have tripled the degree of difficulty by approving a sharp increase in deficit spending.

I suspect we’ll see the usual mumbo jumbo regarding a steadily improving economy, tightening employment without wage pressure, and additional rate hikes being data dependent, etc.  In the meantime, our analog just keeps chugging along.  SPX’s latest dip was halted at the important 2.24 Fib extension as expected.  But, a big part of the equation continues to be Facebook, which nailed our white channel line and rebounded to the neckline of a bearish H&S Pattern.continued for members…SPX and ES, next steps…  If the analog holds, we’ll see stocks jerk higher over the next two weeks.VIX is certainly in a position to make it happen. USDJPY is, as well.But, there remains a conflict among the charts and the probable Fed action.  A spike in stocks would presumably be the result of a dovish Fed signal.

A dovish Fed signal would presumably result in lower TNX and DXY — which would presumably allow DXY and ZN to finally tag their channel bottoms, but would work against USDJPY.  A lower USDJPY would obviously be a drag on stocks. UPDATE:  10:25 AM

Remember, we have crude inventories coming out at 10:30.  CL and RB continue to rally ahead of the data. UPDATE:  11:09 AM

CL and RB pushing higher… I’m going to take a break until the Fed goings on.  More later.

UPDATE:  1:40 PM

Coming up on the FOMC decision — quick update on where things stand.

ES has broken out of the falling white channel and is backtesting the 2.24.

SPX is trying to break above the fan line connecting the highs and Day 11.VIX still has lots of dead air below, could easily drop through 12 in the next week or so.FB is back above its neckline and is testing its SMA200.  Who woulda thunk it?TNX has broken out yet again.DXY still obeying the rising TL, an ascending triangle.

USDJPY is back above the white midline — plenty of room to add to its gains.

CL is still leaking higher……and, RB registering new highs.