FUNDAMENTAL OVERVIEW The S&P 500 has been inversely correlated with oil prices recently as the break above the psychological $100 dollars a barrel triggered a hawkish repricing across the board and increased inflation and growth concerns. It looks like we reached the pain threshold for the market, and a more hawkish Fed could just exacerbate the losses.Chart: S&P 500 vs WTI crude oil (blue - inverted)The focus today will be on the FOMC decision. The consensus is for the Fed to hike by 25 bps, with potentially one or two dissenters voting for a hold. At this meeting, we get the Summary of Economic Projections (SEP) and the Dot Plot. Traders will be focused on the latter where the Fed is expected to project two more rate hikes, one in 2026 and one in 2027. This would still be below the current market pricing of three more rate hikes by the end of 2027. Fed Chair Warsh is not expected to offer much in terms of forward guidance but just repeat his Jackson Hole message. If the Fed signals three or more further hikes, that would likely be taken as a hawkish surprise and could trigger a selloff in the S&P 500. Conversely, a forecast suggesting just one or two more rate hikes could be taken as dovish and could lead to a relief rally in the short-term.The other major focus will be developments in the Middle East, as oil prices have been the key driver of markets recently, so any de-escalation in the Middle East could push oil prices lower and lead to a dovish repricing, which could ultimately support the S&P 500.For now, I think the macro backdrop will continue to limit the upside and weigh on the market unless we get a de-escalation in the Middle East or a dovish Fed. S&P 500 TECHNICAL ANALYSIS – DAILY TIMEFRAMEOn the daily chart, we can see that the S&P 500 (CFD tracking E-mini futures) is trading at the 7,600 support ahead of the FOMC decision. The buyers will likely step in around these levels with a defined risk below the support to position for a rally into new record highs. The sellers, on the other hand, will want to see the price breaking lower to pile in for a drop into the 7,300 level next. S&P 500 TECHNICAL ANALYSIS – 4 HOUR TIMEFRAMEOn the 4 hour chart, we have a downward trendline defining the bearish structure. If we get a pullback into the trendline, we can expect the sellers to lean on the trendline with a defined risk above it to target a break below the support and new lows. The buyers, on the other hand, will look for a break higher to increase the bullish bets into the next trendline around the 7,700 level.S&P 500 TECHNICAL ANALYSIS – 1 HOUR TIMEFRAMEOn the 1 hour chart, we can see the price is breaking above the minor trendline that was defining the bearish momentum on this timeframe. It could be a signal of a bigger pullback into the next trendline but from a risk management perspective, it would be better to wait for the FOMC decision before committing to new positions. The red lines define the average daily range for today. UPCOMING CATALYSTSToday, we have the FOMC rate decision. Tomorrow, we get the US Jobless Claims figures. Traders will also keep a close eye on developments in the Middle East. This article was written by Giuseppe Dellamotta at investinglive.com.