A lot going on this week. The fed meets and it’s anticipated that there will be a rate hike. My opinion is that a hike is almost certain. The only uncertainty is the language the Fed takes going forward. With the transition of power and the prospect of a 15% corporate tax combined with removing the crushing regulations on our business, Fed will take an aggressive approach. In other words the jawboning by the fed will be met with actual rate hikes rather than the threat of hikes.
I am however no certain of the wisdom of the hikes at this stage. To me it appears to be a closer call than what some of the financial types are saying. The world is far from being out of the woods. I could list the pros and cons but the list would be way too long:)
The other item of interest this week is the transition of power, in particular, the electoral college vote. As an aside to this is the Washington Post indicating that an “unnamed high ranking government official” said there was a “secret” CIA report regarding Russian hacking with the intent of swaying the election. President Obama has ordered a review of this charge.
So the stage is set now for a constitutional crisis in the event things get out of control. The Recount efforts are dead in the water. So I view this as the last gasp effort to change the election results. And if this gets even close to successful the markets will take a plunge that many of you have never seen before.
Now that is a big if and the odds of it getting that bad are very low. But considering the ramifications if things take a turn toward the results of the election being overturned its something a trader needs to keep a watch on.
My biotech indicator is not so good anymore for predicting this risk as the President -Elect has made some comments contrary to the Biotech industries interest. So That removes IBB from and predicitve etf of a potential reversal of election results.
I am long looking to get longer. Hilstorically the all clear date is December 16th. If we get a dump before then it should be an excellent opportnity to take advantage of the 2 week bullish window. Its not 100% but its about as good a period as you can find to get aggressive for a 2 week period.
My breakout trades have not been faring very well but the losses have been very small. The medium term swing trades however have been excellent. On medium term swings there is less of a likelyhood of getting wiggled out:)
If you want to follow some of my trades along with my thoughts typically given after the open you can go to @rickjswings. It’s my private twitter feed for the stock market and its free. Sports Handicapping is the subscription-based part of this site. But considering the cost of joining it’s almost free:)
Good Luck Today
RickJ’s Handicapping Picks