I have been giving it some thought and I have a feeling that there will be a rate hike on February 1st and I will list my reasons. #1) We are currently in the micro wave 5 which wont last until the March 14th Fed meeting. 2) The CME group has a FED Watch tool that gives a percentage for the likelihood for a rate hike for this year.....and for Feb 1st we are at 96%. #3) the RSI is showing a good sized bearish divergence that you can see below. #4) we have not had a DCL low since November 4th and we are about due. #5) the market barely took a hit at the last rate hike and now the DOW just broke 20,000 which usually lets the FED know that the market can handle a rate hike.
So then, if they do hike what could be expected for a drop in the SP500? If my wave count is correct and we are currently finishing wave 3...and this correction would be a wave 4, then we shouldn't be able to drop below the bold black line with the blue arrow which is 2194 max. But a more likely target for me would be the 100 DMA which should be approximately at 2210 - 2215 range by that time.
Last little tid bit> what looks reasonable for a target price by February 1st. Well, you will know on that day or the day before but I am thinking that we push up to just over 2300, maybe up to 2310. Which we are almost there. GL
So then, if they do hike what could be expected for a drop in the SP500? If my wave count is correct and we are currently finishing wave 3...and this correction would be a wave 4, then we shouldn't be able to drop below the bold black line with the blue arrow which is 2194 max. But a more likely target for me would be the 100 DMA which should be approximately at 2210 - 2215 range by that time.
Last little tid bit> what looks reasonable for a target price by February 1st. Well, you will know on that day or the day before but I am thinking that we push up to just over 2300, maybe up to 2310. Which we are almost there. GL