{"id":628,"date":"2025-05-08T13:51:13","date_gmt":"2025-05-08T13:51:13","guid":{"rendered":"https:\/\/thetradingdictionary.com\/index.php\/2025\/05\/08\/fed-watch-key-bullish-patterns-in-the-sp-500-utilities-and-crypto\/"},"modified":"2025-05-08T13:51:13","modified_gmt":"2025-05-08T13:51:13","slug":"fed-watch-key-bullish-patterns-in-the-sp-500-utilities-and-crypto","status":"publish","type":"post","link":"https:\/\/thetradingdictionary.com\/index.php\/2025\/05\/08\/fed-watch-key-bullish-patterns-in-the-sp-500-utilities-and-crypto\/","title":{"rendered":"Fed Watch: Key Bullish Patterns in the S&P 500, Utilities, and Crypto"},"content":{"rendered":"
\n

The S&P 500 ($SPX) wrapped up Tuesday just below its intraday midpoint and posted one of the narrowest ranges we’ve seen in the past two months. That’s a clear sign traders are reluctant to take major bets ahead of Wednesday’s 2:00 PM ET Federal Open Market Committee (FOMC) decision.<\/p>\n

And honestly, this caution makes sense. If we look back at how the stock market has reacted following the first two FOMC meetings of 2025, there has been a mix of hesitation and sharp moves.<\/p>\n

Below is an updated chart marking each FOMC date since 2024 alongside the S&P 500. After the late January meeting, the S&P 500 zig-zagged to marginal new highs over the next two weeks before the first of two sharp down legs unfolded.<\/p>\n<\/p>\n

FIGURE 1. FOMC DATES SINCE 2024.<\/span><\/p>\n

Coincidence or not<\/strong>, the S&P 500 is trading at nearly the same price level<\/strong> now, six weeks later, as it was back then. So, how close are today’s prices<\/strong> compared to the close on March 18<\/strong>, the day before the last Fed meeting?<\/p>\n

This close (see chart below):<\/p>\n<\/p>\n

FIGURE 2. THE S&P 500 IS TRADING VERY CLOSE TO LAST FOMC MEETING LEVELS. <\/span><\/p>\n

The difference is that the index has been rallying for four weeks<\/strong>, starting from the pivot low on April 7, <\/strong>a month ago today. In March, the S&P 500 was trying to bounce<\/strong> after topping four weeks earlier on February 19<\/strong>. That bounce continued for a few more days before dominant down-trending price action<\/strong> took over.<\/p>\n

But over the last few weeks, the dominant trend<\/strong> is definitely higher<\/strong>. So the big question now is: can this mini uptrend<\/strong> resume after this pause?<\/p>\n

A Short-Term Setup to Watch<\/h2>\n

A few days ago, the 14-period <\/strong>relative strength index<\/strong><\/a> (RSI)<\/strong> on the two-hour chart grazed the 70-overbought level<\/strong> for the first time since late January (see chart below). Yes, it took a nearly 18% rally in a very short time frame<\/strong> for it to finally happen, but remember, the indicator was coming off its lowest level since the COVID lows.<\/strong> Modest 3\u20135% pops<\/strong> were enough to trigger overbought readings for much of 2024. Not this time<\/strong>.<\/p>\n

As you know, overbought conditions never persist<\/strong>, especially in very short timeframes like this. However, if this rally has anything left in the tank, we’ll see the indicator hit overbought again soon<\/strong>. That may not happen in the next day or two, but if<\/em> the market reacts negatively to today’s news, but a bid returns soon after<\/strong>, it could keep some of the bullish patterns<\/strong> we’ve been tracking in play. That’s just one scenario, but one we’ll be closely watching.<\/p>\n

\n

FIGURE 3. TWO-HOUR CHART OF THE S&P 500.<\/span><\/p>\n

Bullish Patterns Still Intact<\/h2>\n

There are two bullish pattern breakouts still in play on the S&P 500 chart:<\/strong><\/p>\n