The Daily Ticker | My Big Bold Prediction 3-22-23
Fasten your seatbelt and have in your stop orders, the market is setting up for a volatile move.
I don’t like to predict, it’s easier to pay attention and follow the tape. But today is different. Not only am I going to predict, but I’m going to tell you the exact time!
2PM eastern today.
The FOMC makes its announcement on interest rates today. Odds are that we’ll see a 25 basis points rate hike. This continues the string of rate hikes intended to bring down inflation.
Many are claiming the system is broken. Shouting that it’s not working. Begging them to stop. But what about the 2023 rally? Aren’t tech stocks, “growth companies” supposed to go down as interest rates go higher?
If the FOMC raises interest rates, it can make borrowing more expensive, which can lead to lower corporate profits and lower stock prices.
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Yes.
But that’s not happening. Tech stocks are screaming higher.
Inflation, the Federal Open Market Committee (FOMC), and employment data can all have a significant impact on the stock market.
Inflation refers to the rate at which prices for goods and services are increasing over time. In general, higher inflation can lead to higher interest rates, which can make borrowing more expensive for businesses and consumers, and can reduce corporate profits.
This can lead to lower stock prices, as investors may become less optimistic about the future prospects of the economy. But that’s not happening.
Here’s the big picture question. Was the 2022 bear market, the decline everyone is discussing, even waiting for? Did the market already crash because quantitative easing stopped and interest rates started going up?
We’re in such a short term news cycle that everyone forgets the markets look into the future. Let’s unpack the doom, we have the fight against inflation, unemployment, the crypto crash and even the banking crisis.
Would you believe that the S&P 500 is at the same price it was in May of 2022? Ten months later and the S&P 500 is 14% higher than the low of 2022.
Is the crash inevitable? Has it already happened?
Stay tuned. Today will give us some clues.
Sector Rotation
Technology has the most number of stocks (42) that show stacked order flow. But there’s another sector drifting higher the last five days, healthcare.
Tech had solid breakouts in #PANW #SMAR #PD #SMCI and #ANET. Stacked order flow and harmony. Many also near the optimal entry.
Bullish moves of note in healthcare include: #DXCM #SYK, while a few are nearing fresh breakout levels: #ABBV #HCA and HUM.
Consumer cyclical stocks showed a few breakouts from two week ranges, a few include #TSLA #KBH #DRI. And a few knocking on the door: #GOOGL, #AMZN #CROX #SE and #MCD is trying to finally punch above the six month down trend.
