Will Rising Interest Rates Crash The Market?
Despite previous data showing the contrary, many believe that rising fed interest rates will be a catalyst for a down turn.
In the chart above, I compare the federal fund rates (blue) to SPY (orange).
As you can see in the past, a rising interest rate was NOT a catalyst for a crash. Of course this time could be different, but there is no evidence currently showing that it should be different.
If anything, a falling rate appears to be catalyst and usually coincides with a down turn in the economy.
I'm not saying that the market will continue to go up from here, all I'm saying is that if it continues to go down, it will be hard to blame the rates as the reason.
In the chart above, I compare the federal fund rates (blue) to SPY (orange).
As you can see in the past, a rising interest rate was NOT a catalyst for a crash. Of course this time could be different, but there is no evidence currently showing that it should be different.
If anything, a falling rate appears to be catalyst and usually coincides with a down turn in the economy.
I'm not saying that the market will continue to go up from here, all I'm saying is that if it continues to go down, it will be hard to blame the rates as the reason.
My goal is to find the best risk:reward setups. For instance, if you risk $1,000 at a chance to make $5,000, you can afford to be wrong 4 out of 5 times and still not lose money. I hit my targets over 50% of the time.
