WAITING FOR THE FED

Futures are up, take that, Big Ben! However, like other days of this week, the futures are not to be trusted. There's almost no chance that the market will move significantly before 2:15 pm. If the market opens higher, it is likely to fade away quickly. Numerous talking heads on the tube will not help the market either.

It's hard to believe how and why the market will move up even after the Fed speaks. Let's examine the scenarios:

• Scenario 1 (50% probability) - 25 and same language (data-dependent, vigorous, may increase again in August, blah, blah, blah...). While it may pop up initially, I can't imagine anyone would like this scenario, and the market will be sold off, possibly significantly.

• Scenario 2 (25% probability) - 50 and pause. This is a scenario that has been talked a lot lately. I believe the market will likely like this one and will likely move up, resulting in a near term rally. This makes sense, too much sense, but that is wishful thinking. I do not believe the chance it very high. Even it does occur, the language will have to include: "while......, we remain vigorous and will not hesitate to raise.....".

• Scenario 3 (15% probability) - 25 and pause. Obvious the market will like this one and rally.

• Scenario 5 (10% probability) - 25 and done. Dido.

Again, I believe the path of the least resistance is, unfortunately, DOWN. Having said that, the market could rally because it has been down so much during May-June, and it could potentially rally by fading the "sell-the-Fed-news". (Fade the faders). It this occurs, the rally, while potentially fierce, may be again short-lived.