J.Powell said this week said smaller interest hikes could start in December 2022. Elon Musk said the FED has to pivot immediately, otherwise the more they wait, the more it amplifies the probability of a severe recession.
Some indicators show the FED is going to increase the rates only one more time and then hit the pause button for a good part of 2023. Then maybe resume the interest rates cut.
Then, we can wonder, is the bear market over? Is it time to buy stocks?
Quick answer: Absolutely not
Any fundamental trader (which I'm not) should notice that whenever the FED pivoted in the past, a stocks crash followed shortly after
I'm going to say it one more time differently just to put my point across.
FED pivoting IS NOT EQUAL to stocks pumping.
In fact, FED PIVOT = STOCKS MARKET CRASH
The image I copy/pasted on the chart is very telling.
What will happen when the FED will pivot?
Based on historical data, it's a dangerous time to be swing long without SL and never taking some profit out of the table.
Mainstream media, Jim Cramer and Youtube finance influencers telling us to buy the dip ... should be concerning for traders being LONG.
Anything could happen of course, but if I'd play the probabilities and if I'd be a Fundamental trader, I'd cut my SWING longs after the FED will pivot.
There is a big spiculation at the stoc market. The economy in bad condition but the market goes up. This is a spiculation. This is not a normal. If will be not a crash at the economy will be mega infilation.
ashdays
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Thank you for sharing your insights. Much appreciated