Today's Update:  We will remain Neutral for now.

Why:  Yesterday, the S&P gapped down nearly -1%, which is unusual on the day of a scheduled FOMC meeting.  The half-dozen times we've seen it before, it marked a short-term low each time as the S&P rebounded in impressive fashion over the next 2-3 days without fail.  After some quick post-open selling, it looked like we were once again going to see an upside reversal, but that "without fail" distinction looks to be in danger today as the futures are already indicated to open down nearly -1.5%.  The last time the futures gapped down more than -1% the day after a FOMC decision was back in January 2009, which led to even more selling pressure in the day(s) ahead.  In fact, that was something of a pattern - any time the S&P gapped -1% or more the day after a FOMC announcement, it slid even more over the next couple of sessions 7 out of 9 times, averaging a return of -1.3%.  The extreme choppiness and whipsaws of the past week have not allowed our shorter-term guides to move to any kind of suggestive extreme, so they're not much help here.  Technically, the S&P looks to open right near the 1100 area that many are using as major support, so that should be the main battle today.  Given the stat above, if we see a lower intraday low after the first hour of trading, particularly if we sink below 1100 as well, it will not bode well for the coming days.

Today's Update:  We will remain Neutral for now.

Why:  In late May, we looked at quite a few  bullish intermediate-term studies - we got a major surge in pessimism, then several positive breadth thrusts and positive price performance, all in the context of an ongoing bull market.  But after just a brief respite, June 4th's Payroll Report kneecapped the rally attempt and took us to a new closing low.  In the process, we saw very oversold conditions and some give-up among Rydex traders and individual investors.  In early July, we saw even more evidence of excessive pessimism.  The big missing piece, though, was the price action - the S&P was making a clear series of lower highs and lower lows, which muddled the risk/reward of stepping in and buying into those pessimistic conditions.  The market has obviously recovered well from there, and with the advance/decline line making a new all-time high, things are looking brighter for stocks.  The S&P still is flirting with the 1125 area, but much more upside will break the pattern of lower highs we've been mired in since the spring.