A large gap-up open on Tuesday triggered a short-covering rally that lasted most of the day with some profit-taking decline at the end of the day.
With the FOMC policy announcement due in the afternoon, there may be more short-covering rally on Wednesday if the Fed is going to announce some form of stimulus. There is usually some pullback down in the morning ahead of the FOMC decision.Without any stimulus however, the market may sell-off.
Key Level For Wednesday is 2620.
- Bullish above with the next resistance at 2640. A clear and sustained break above 2640 can trigger another round of fast short-covering rally.
- Below 2620 implies a decline down to 2600 then 2585.
