Not surprisingly, we got another Fed mini-drama today triggered by the 2PM release of the minutes for the April 26-27 FOMC meeting. The S&P 500 opened in the red and rallied in a couple of waves to its 0.65% intraday high a just before the minutes were released. The index then plunged to virtually equidistant -0.62% intraday low about 30 minutes later. The index then churned for the next 90 minutes to its virtually flat finish, a microscopic 0.02% gain.

The FOMC minutes showed a somewhat more hawkish Fed perspective than generally expected, which significantly increases the odds of a June rate hike. While the S&P 500 went nowhere at the close, the yield on the 10-year note reacted more dramatically, closing at 1.87%, up eleven basis points from the previous close.

Here is a snapshot of past five sessions in the S&P 500.

Volume on the five-day chart above is erroneously skewed, apparently by technical glitch, but on the daily chart we see the participation in today’s mini-drama was on a bit above the 50-day moving average. 

A Perspective on Drawdowns

Here’s a snapshot of selloffs since the 2009 trough.

Here is a more conventional log-scale chart with drawdowns highlighted.

Here is a linear scale version of the same chart with the 50- and 200-day moving averages.

A Perspective on Volatility

For a sense of the correlation between the closing price and intraday volatility, the chart below overlays the S&P 500 since 2007 with the intraday price range. We’ve also included a 20-day moving average to help identify trends in volatility.

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