The stock indexes traded at a wide range Monday.  

After rising over 100 points, the Dow Jones Industrial Average closed down on the day, losing 3.63 points. The S&P 500 (SPX) was fractionally lower while the Nasdaq closed down 9.53 points. The Russell 2000 (RUT) was the only index that traded higher on the day, gaining 7.73 points.

The (SPY) volume was the lowest volume day since Sept. 8, trading 80 million shares.

It appears that the markets are taking a wait-and-see approach ahead of the Federal Open Market Committee interest rate decision on Wednesday.

The markets may trade to the downside on Tuesday in anticipation of no interest rate increase.  The markets will then be situated for a huge move to the upside as the Fed will give the all-clear sign again to buy stocks after 2 on Wednesday afternoon. There should be some huge volatility after the announcement.

It would appear that volatility is once again returning to the stock market after taking a few months vacation.

In the short term, markets should trade higher after the Fed announcement.  If the Fed surprises and raises interest rates, the stock market could react violently to the downside. The markets are not expecting a rate increase. Volatility will then be massive with the CBOE Market Volatility INDEX (VIX) soaring to the upside.

The (VIX) eight-day moving average is close to trading above its 22-day moving average (see chart above).  That would be a sign of a move much higher in the price of the (VIX).

Also, the SST Strategic Numbers are showing a bullish stair-step higher, weekly pattern.  That weekly pattern is powerful and should continue to move higher.

In addition, if the Fed does not raise interest rates, expect the dollar (UUP) to trade lower, and gold and the gold miners to trade higher.

Currently, I have a long position in the Direxion Daily Gold Miners Bull 3x(NUGT) - Get Report in anticipation of no rate increase.

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There are many moving parts as we await the Fed decision. Stay nimble.

Finally, be prepared for anything and do not place any big bets one way or the other in the short term.  Currently, the markets are positioned for bullish trading and bearish trending.      

This article is commentary by an independent contributor. At the time of publication, the author was long NUGT.