Oct Rally Might Be On Thin Ice

So far today, the e-SPZ (e-mini S&P 500) has pressed from a new all-time high at 1773.25 to an intraday low at 1761.50, where the price structure slightly penetrated the lower support line of the Oct 22-Oct 30 rising-wedge formation.

As we speak, however, the e-SPZ appears to be holding the lower support line, at least for the time being, and more than likely, will continue to do so ahead of the FOMC announcement in 2 hours from now.

The reaction to the Fed statement will be interesting.

I think we should expect a knee-jerk upmove for an initial reaction, but thereafter, any strength must sustain, otherwise, the index will be increasingly vulnerable to a nasty decline and a resumption of selling pressure off of this morning's new all-time high, in what could become a significant downside-reversal day.

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