Fed meetings are notorious for volatility and are responsible for some of the largest market moves, especially since the introduction of QE. What I wanted to do, in preparation from tomorrow, is talk about recent history and the lessons we have learned. More importantly, talk about the state of the markets and get a better understanding of exactly where this market stands during this historic time.
As it stands today, since November 19th, the NASDAQ is down nearly 20%, the S&P is down around 10% and ARKK’s innovation fund has basically died and is down 55%. The culprit (if many don’t remember) was when the Fed announced their tapering program in November. This was approximately about the time that I came out and warned about a market crash.
The reason why I publish these articles is that market movement can be reasonably predictable, based on history, when you assume liquidity is the primary driver of asset prices
The FOMC meetings often signals major changes in direction for the market. In this publication, we are going to look back on major dates (since the introduction of QE) and what the market did after the Fed announced a policy change. On a few of these dates, this has signaled periods of market reversal upward and downward.
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