-Looking at the current levels, SPY is super close to the danger zone which is at $427 and the second one is at $420. If SPY breaks below these two, we might have some serious problems!
-Alright but before panic selling, hedging, and liquidating, what is our plan? Why should we be scared or maybe not?
1) U.S debt level increased a lot during that bond purchase period where FED was infusing money into the economy, if we should talk more specifically, we are talking about $100 billion USD each month. Now we are looking at recovering from the pandemic's negative economical effects, to do so we have to implement these monetary regulations (Tapering).
-But will rate increase help the economy? Well, it will help the dollar add value to itself for sure, but what about retail sales and consumption? People won't feel that free to take them loans and spend it as if interest rate ain't a thing. The drop in consumption might cause a possible recession.
2) Inflated market needs to chill down. During the pandemic, we saw one of the fastest rebound from the drop to the highest-highs. Tech sector had enormous gains and attention which gave a lot of bubble feeling to professional investors and the whole finance world. With the current uncertainty, all of them, especially unprofitable ones are dropping. Will they be able to hold on the game when they will have to roll their loans with bigger rates? Or will their private investors be willing to give out the valuable cash when the whole market drops, to support the business?
-A lot of these companies are not expected to get into profit zone any soon, and we are talking about the future 3-5 years. So market definitely looks more bearish than bullish.
When it comes to technicals, SPY must stay above $427 which we doubt it will.
As much as it seems do-able, bidens been in waay too much hot water for his first year as president. If he lets the economy crash before the midterms, the dems will lose absolutely everything. I think we have one more big pump in the economy before the crash. If not... well... its gonna be one hell of a dip to buy
shyMeerkat42138
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@brandonclark9404, Yeah, assume everything is connected to the president of the united states and they have full control. Go ahead and buy that dip.
caldooninvestment
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Its the political and economical catalysts that are driving us back into the volatile sessions. Not sure what will happen on weekly basis hard to tell but dip is coming for sure 👍
ruby_redusa
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@brandonclark9404, I hope they lose EVERYTHING!!! Whatever whenever he comes out and say LOOk! Folks. I want to puke ! And he is literally provoking every bad thing could happen at the same time !
ViciousNeutral
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@ruby_redusa, yeah now you know how I felt every time we heard Dunce say something was "the best" or "witch hunt" or "fake news" etc. etc. etc.
ruby_redusa
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@jbielski, where do u hear those
ruby_redusa
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@jbielski, all I can feel is they escaulate the war between Russia and Ukraine to distract people from the freedom convoy. Crashing the market so people talks about the crash .
ruby_redusa
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@brandonclark9404, but historically don't we prepare for the mid term crash ? It is unspoken . I do wish there is one more pump but I am betting my luck which I don't have none left . :( Depressing as it is
caldooninvestment
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@ruby_redusa, not sure what strategies you are applying on your trades (options), but if you join our telegram group (link in bio), I haven't seen one single individual at a loss this month on our group. You will get some great signals which might get you out of that depression :)
wardaK
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Thousands thanks for this clear and perfect resume of why and what we are experiencing in this scary market... kudo to you