11:04 am EDT:  The ES has demonstrated some marginal strength by trading above the daily pivots, though it has not been able to trade beyond the overnight high (also closing VWAP) of 1096.00.   We now have more confidence in the morning report’s projected range of 1084.25 to 1098.00.  The potential for surprise political news remains, so caution is warranted.  Absent that, we don’t expect any major moves today.

The Precise Take – ES floundering at lows on political uncertainty

Leaders Analysis:  The US Dollar is strong overnight on more China tightening hype and has refused to sell off from key resistance.  The EuroYen forex cross, as a barometer of global risk appetite, has sold off through support.  30 Year T-Bond futures have capitalized on the flight to quality and are up overnight.  All in all, slightly equities bearish, the “slightly” only because of the potential for reversal in the Dollar from the current level.

Medium Term Analysis:  While we expected some chopping around until the close today before the bullish FOMC seasonality kicks in, the material move down overnight puts a slight damper on the rebound scenario.  Having said that, the ES has retraced a good portion of the overnight losses as we write.  With Bernanke covering both the FOMC meeting today and tomorrow and meeting with senators to save his job, anything can happen. 

Trading Today:  The day prior to an FOMC Announcement is typically subdued, but political news could change that.  Further, given the numerous clusters of support and resistance and volatile overnight action, the projected range today is a bit arbitrary.  It could easily be as low as 1080.00 and as high as 1101.00.  We will instead focus on…

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