To The Moon

We are 1 day away from Fed decision on rate hike tomorrow (20 Sep 2023), there have been a flat performance of all 3 indexes yesterday (18 Sep 2023), beginning of week.

So how would $NASDAQ(.IXIC)$ perform when Fed make its decision?

Nasdaq lost 0.2% in the last Fed FOMC meeting on 26 July 2023 after Fed announced that they will be raising 25 basis points. With market anticipating that Fed would not be raising rate this time, will Nasdaq give us a short rally?

I will be sharing some data which I think might be useful for us to look at when Fed makes its decision.

Something we also need to be aware is the release of the minutes of meeting afterwards, for the July 2023 meeting, the meeting minutes was released on 16 August 2023.

Yields climbed more following the release of the minutes from the Federal Reserve’s July meeting. Fed appears unsure about its next move on interest rates.

The last time, market is hoping that July’s rate hike would prove to be the Fed’s last.

U.S. Treasury Yield (10 Years) vs NASDAQ (.IXIC)

As we can see that yield is continuing to rise even before the Fed decision announcement. And Nasdaq has been trending downwards despite according to CME probabilities, 99% was assigned to Fed holding the rate constant.

So will we be seeing a short rally on Nasdaq on 20 September 2023 if Fed announced that there will be NO rate hike, but Nasdaq could suffer a drop on the day the next meeting of minutes is released?

Let us take a look at how the options contracts are stacking up today (19 Sep 2023).

Most Active Options For 19 Sep 2023

Based on what I have shared earlier in another article, this serve as a good guide for us to plan how we intend to trade.

Evaluate Most Active Daily Options Trade Data [18 Sep 2023]

As what the options contract are showing does give a significant overview of how stocks would be traded later in the market.

But do remember that there are still other factors like major events, news or sudden negative impact could cause the movement to be otherwise.

%Calls Higher Than %Puts

$Marathon Digital Holdings Inc(MARA)$ seem to have a higher %Calls than %Puts, which mean that traders are rather bullish about this crypto stocks.

The reason might be due to the crypto stocks avoiding the “death cross”, which I have shared in an earlier article as well.

"Death Cross" Appear For BTC-USD. Is this Opportunity or Caution For Crypto Stocks

Bitcoin is still trading above $26,000, which I have mentioned in the article that if Bitcoin price maintain above $25,000, then the impact and behavior of “death cross” might not stand.

This would mean that we could be seeing some potential strong crypto rally as well.

$Nikola Corporation(NKLA)$ is another stock worth looking at, if you check out my earlier article, the %Puts was higher than %Calls and it went on a rally of more than 30% last night.

We can see than now it is having %Calls higher than %Puts for 19 Sep 2023. I see a potential upside for NKLA as I have taken a position on 18 Sep and will be taking another position today (19 Sep).

With their COO who is from GM, I believe she would be able to contribute to Nikola’s hydrogen fueled truck sales strategy.

%Puts Higher Than %Calls

These 3 stocks seem to be inline with the %Puts higher than %Calls, it looks like they are on a bearish trend.

If you would like to find out more, you can look at how their price is at the 50-day period MA.

Summary

Based on what I have gathered and shared, it look like the stocks in Nasdaq are having bullish sentiment from the market.

Hence, I foresee that we might see a small rally of NASDAQ today (19 September) before it start to trade flat on 20 September as investors would be trying to figure out what Fed decision mean for the entire market.

Appreciate if you could share your thoughts in the comment section whether you think Nasdaq would be trading flat on 20 September 2023 with a small rally today (19 September)?

@TigerStars @Daily_Discussion @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.