Sell After the Fed

Today is the big day when the markets finally get to taste the carrot that has been in front of them for the last 2 months.

The put/call ratio is nicely set up for a top:

I think a good opportunity to sell will emerge on a rally after the Fed announcement. Resistance levels from early May are at 1200 and 1205 SPX. I like the latter.

I expect a steep correction, about 40 points in length. The big question is if this is the top of the bear market rally. I think it is not. There is going to be another rally attempt after this correction that can reach higher highs, but not much higher than 1200-1205, say 1211:

I will closely monitor the market during these two moves and expect to see weakness.