Major averages finished quietly lower yesterday and near the top of their respective trading ranges on mixed volume. This comes ahead of the Federal Reserve's policy announcement at 2 p.m. EDT today following the conclusion of their two-day meeting.
The Fed has become increasingly dovish with regard to any interest rate hikes this year as the global economy remains stagnant. That said, they have said they remain open to the possibility of rate hikes later this year depending on improving economic conditions.
The Bank of Japan left its policy rate unchanged at -0.1% while downgrading its economic outlook. Given that its economy has not improved despite negative interest rates, it calls into question what tools central banks have to stoke their respective economies.
The market's future direction may hinge upon the Fed policy announcement, so investors should remain alert to any change of trend. For now the Market Direction Model remains on a buy signal pending any evidence to the contrary.
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