Here is the Market Radar Video for Tuesday and Wednesday
The market is repeating a pattern that it traded in early November. Everything down to the moving averages are similar. Short term signals are mixed and so are longer term. Caution on overall direction but You have to be impressed with resilience of the markets.
Fed Rate hike is right around the corner and I would put a 90% probability of that happening this month... So what happen then? Lets look back at the last Fed Rate Hike
The last time the Federal Reserve raised rates was in June 2006, and there have been three times since 1994 that the markets have faced a rate hike after a lull like the U.S. is seeing now.
Here's what happened those three times, according to Kensho,a market analytics tool. Both the materials sector and the industrials sector traded positive 100 percent of the time in the three months leading up to the hikes, with average returns of 11.64 percent and 9.95 percent, respectively. The worst performing sectors during that time were consumer staples and utilities stocks, both with average returns down about 1 percent.
Well we know the Basic Material Sector has not kept true to form as it is the worst performer over the last 3 months leading up until this action
I feel the data is a little misleading and we should not take it for face value.
In the past six rate-hike cycles dating to 1983, the Standard & Poor’s 500 stock index declined on the day of the Fed’s first rate increase three times, or 50% of the time. The biggest Day 1 loss was in February 1994, when the benchmark stock index cratered 2.3%, according to data from Birinyi Associates. In contrast, stocks jumped 2.3% after the first rate hike in January 1987 and 1.6% following the initial increase in June 1999.
Here are some interesting charts to look at but when it comes down to it for me as a trader it might be just better to lighten the load and not take any big bets either way. But my gut is telling me have some spy puts for protection if you are holding long into the decision.
I love statistics as much as the next person, but this market is at a place and time where we cannot really compare it to past events, we are in uncharted territory as the Fed as taken over the steering wheel and the market is not driving on its own any more.
If the Fed Rate Hike causes the markets to go into a tail spin it will only be a matter of time before they announce another round of stimulus
See you tomorrow in the markets..The Futures are trading down -9.00 it is not looking to good as we start off the overnight session
Charts can be seen on http://ift.tt/1bdJIdh
DayTraderRockStar
Submitted December 07, 2015 at 10:17PM by daytraderrockstar http://ift.tt/1XRdwGJ
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