Commencing today the Fed’s open market committee better known as the FOMC will begin a very important two day meeting. All two day meetings are important for investors, but this one could have a very big impact on where the market is headed in the near future.
The past few weeks have seen the stock markets around the world rally on very little positive news, and declining volume and volatility. This is the prescription for what traders call a “Tortoise Bull”. It is generally a rally that is driven by professionals, with the retail client on the sidelines.
The Fed is revealing a new policy that will spell out what they believe short term US interest rates will be for up to three years in advance. Very few observers believe that there will be any change of rates in the near future, but this change of venue could have major impacts on the way the world’s currency markets feel about the US dollar.
Normally when a central bank commits to changing the way it conducts business it is going to bring some confusion and volatility to the markets. When you combine this with the fact that some major players in the currency market are still reacting to the possible re pricing of the Greek debt and you have the formula for some major shakeups on Wednesday afternoon.
Will this volatility hit the US stock markets?
Will it be the top of the current market or do we break out to the spring highs of last summer?
Only the market knows for sure and I doubt that it will let us know in advance. What we need to do is to learn to have the discipline to react to what the market is revealing to us and take advantage of that information.
Discipline and reaction are the keys to any market condition.
Reacting will create opportunity. Recognizing opportunity and the discipline to take advantage of it is my specialty. That is what produces winning trades.
I teach my students discipline and how to make it work for them in any type of market condition. I can teach you too.
To learn firsthand how I would trade this possible spike in interest rates, speak to one of my representatives and sign up to work one-on-one with me here:
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As Always,
Keep those stops tight.
Todd “Bubba” Horwitz
P.S. We run the fastest growing online options community. With weekly webinars and a very energetic forum, my team and I are always looking for great risk/reward opportunities. Click on the link below and become a member of my community today.
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