Historic Low Rates Fuels 6th Day Gains; Dollar Slides

S&P 500 Finds Fresh Annual High as Fed Stands Pat
The Federal Open Market Committee (FOMC) took the spotlight today, and the central bankers shocked absolutely no one by voting to maintain interest rates at their current, rock-bottom levels. The FOMC also reiterated its stance that economic conditions are "likely to warrant exceptionally low levels of the federal funds rate for an extended period."

The initial reaction to the Fed announcement was modestly positive, with stocks clinging to small gains, but the bulls' momentum was dampened by the day's downbeat housing data. The Commerce Department broke the bad news that housing starts dropped by nearly 6% in February, as severe winter weather put a freeze on home building. While stocks maintained a tenuous grip on positive territory through most of the session, a last-minute buying push left the major market indexes hovering near their intraday highs.

The Dow Jones Industrial Average (DJIA – 10,685.98) settled with a respectable gain of 43.8 points, or 0.4%, as all but seven of its 30 components finished higher. General Electric and Intel paced the 23 advancing equities, while Boeing set the tone for the six decliners. Meanwhile, Pfizer shares finished the day right where they started. Today's modest rally in the Dow was stopped short by the 10,700 level, which could act as short-term pressure for the blue-chip barometer.

The S&P 500 Index (SPX – 1,159.46) one-upped the Dow by notching a fresh 52-week high of 1,160.28, before wrapping up the session on a gain of about 9 points, or 0.8%. The SPX is solidifying its foothold north of the key 1,150 level. In similar fashion, the Nasdaq Composite (COMP – 2,378.01) tagged a new annual peak of its own, jumping as high as 2,378.84 today -- its best price since Sept. 2, 2008. The COMP tacked on 15.8 points, or 0.7%, by today's closing bell.

The Dow 5 mins chart shows how the day played out. The action drifted to flat ahead of the FOMC announcement, then after the typical post-Fed-stutter-step, buyers stepped in for the final hour. The S&P 500 finally hurdled it's resistance.

All of the indexes remain in overbought territory but the SPX and COMP both sit above support. The DJIA is now in a position to challenge its highs from January so that is what I will be watching next. And that is where I will pick up in the morning.

And that is where I will pick up again next morning.
Have a pleasant trading day.