SPX and BKX Updates: Fed Day

Last update concluded with:

...my "perfect world" count would see us rally back up to retest the high again, then decline back to test the most recent relative low (either Friday's low, or a minor new low this week). 

SPX made a minor new low, then launched into a strong rally, so that "perfect world" outlook is looking reasonable at the moment.

Beyond the charts:  Today is, of course, the infamous and aptly-named Fed Friday (which often falls on Wednesday, due to a repeating error on the government calendar).  The investment world is anxiously awaiting the events of this afternoon, when Janet "Gellin' Like Janet" Yellen will emerge from the Fed's Reality-Deprivation Chamber, where she's been sealed since birth; if she sees her shadow, the Fed will hike interest rates for six whole weeks, or until such time as the economy weakens further, whichever comes first.

Bulls are hoping for rates to remain steady at -4000%, which is the same level they've been since the earth cooled.  Some folks have been saying that bulls want Janet to raise rates, because: reasons.  But regardless of what bulls may say publicly, the reality is that bulls are secretly hoping Janet will LOWER rates to an economy-stimulating -18,000%, while at the same time launching QE IV: The Revenge of the Fiat, just in time to compete with the latest Star Wars movie. (Or is it QE five?  Six?  I've lost count.)

Anyway, Fed Fridays are usually volatile days, frequently punctuated with whippy price action that reflects the underlying bull and bear angst, and often burning one side badly... just before burning the other side badly.  Accordingly, we're going to simply stick with my original read that we'll rally back to retest the recent high before dropping back down.

Obviously, if we experience a sustained breakdown of Monday's low, then all bets are off for a retest of the high; and on the other side of the trade, if we break out over 2117, then it's possible that ALL OF Bull (iv)/2 is complete.

Here's a simpler hourly chart of SPX:

And finally, another look at BKX:

In conclusion, the market has followed my expectations from the last several updates, albeit not to the penny, but well enough.  Given that, and the fact that it's Fed Friday, there's no reason to form any new theories.  Trade safe.