The Federal Elephant in The Room

First it was the pandemic trade. Then it was the re-opening trade. On Thursday, after the Fed, it looked like a return to tech but not much else. Oil stocks were sold hard. Gold stocks were buried. Bank stocks got hit hard. Lumber got cut. But the indexes portrayed a relatively calm day. The Nasdaq 100 had a nice push to break out of the range.

The XOP dropped hard in the morning, then drifted sideways throughout the day. Quite frankly, I can't figure out why anything I heard the Fed say would change the difference between the acceleration of demand and a shortage of drilling.

One day doesn't make a trend, but some of the charts look hurt by more than just a one-day move. Looking in on the gold chart, talk about losing its luster. You'd think it was coal nuggets in California's daily save-the-world conference.

For lumber, it was a continuation of the trend, but another drop.

Even Copper couldn't withstand the Fed comments. It has been a big plunging drop in Copper this week after breaking the uptrend.

Lastly, the banks were hit. This is an update on the chart I used last week. It clearly looks significant, with a drop to two-month lows and less then $2 from completely rolling over below the topping structure support.

The swings are vicious. The more amazing part was that the Fed Chair basically reiterated what we knew.

Friday is quad witching. I'll be watching to see if Thursday was just a whipsaw or something more permanent by early next week. But, at the current drop rate, it wouldn't take long to wipe out the first-half gains.

Careful out there.