Market Update

The VXX is not as high as yesterday and the market is almost at the same level and trending lower.

We have negative cash volume on the NYSE and NASDAQ and most of the traders are waiting for the FOMC.

We are still long and holding SPY and QQQ options looking for a retest of the 1805 levels in the SP chart below.

Stocks Mixed ahead of FOMC Rate Announcement! Stocks on Wall Street are in a holding pattern ahead of the FOMC rate decision. Today’s U.S. housing starts report revealed surprising firmness in the long-delayed starts data for the last three months, though with a back-loading of strength into November, alongside the expected small November drop-back in permits that still left a strong permits trajectory.

November housing starts strength was spread across the important single-family starts data as well as the multi-family measure, though the November spike was skewed to the Midwest and South, and the growth path for starts under construction remains solid as well. U.S. MBA mortgage market index sank 5.5% in data released earlier, while the purchase index fell 6.1% and the refinance index dropped 4.3% for the Dec-13 week.

Supply kept a floor under yields last week, along with the looming Dec FOMC meeting that finally concludes this afternoon. But the average 30-year fixed mortgage rate only rose a basis point to 4.62% last week.

SPX: /ESH4