Fed news: Change of Heart could trigger strong rally

A chicken doesn’t stop scratching just because worms are scarce.
Grandma Axiom

Fed News and the Art of Deception: How Central Bankers Manipulate the Masses

Central bankers have repeatedly deceived the masses (including hard money experts) with the recurring theme that one day the Fed will make a grave mistake, and chaos will ensue. The question remains: when will this day come? Today, tomorrow, or in several decades? Countless individuals, convinced of their convictions, have met their financial demise waiting for this day. The crucial lesson here is to follow the trend, as everything else is an adversary.

The Calculated Blunders: Fed News Keeping the Hard Money Advocates Hopeful

Curiously, central bankers have orchestrated seemingly foolish moves, allowing hard money proponents a moment of vindication after decades of being metaphorically slammed into the ground. Then, out of nowhere, a surprising left hook catches the masses off guard, and the impossible suddenly becomes possible.

The Disposable Golden Goose: Why the Fed Remains Unconcerned

The Fed remains unconcerned with over-exploiting financial resources since there are always more proverbial cows to milk and geese to lay golden eggs. Whether or not we agree with their actions is immaterial; what matters is anticipating the next development. The trend suggests that as long as misery loves company, the masses will continue to lose.

The Fed’s Mastery of Mass Psychology: How Emotions Drive Financial Decisions

Central bankers are experts in mass psychology, understanding the limits to which they can push the masses. With emotions driving the decision-making of 99% of the population, comprehending mass psychology is the key to unlocking the primary force behind the collective mindset. This is precisely why the Fed can push the envelope to its extreme limits.

Embracing a Bullish Perspective Amidst the Fed News

As naysayers predicted the market’s demise, we took a contrarian stance and viewed market corrections through a bullish lens. We can successfully navigate the ever-changing financial landscape by staying alert to the Fed’s manipulation tactics and understanding mass psychology.

The number of bears has increased to 41%, and the neutrals have dropped to 31%; individuals from the neutral camp have jumped into the bearish camp. The combined score is 72%, which indicates that emotions will soon hit the hysteria level. The illusory economic data still looks great and markets do not crash when the perception is that the economy is improving and market sentiment is bearish. More downside testing is likely, but a crash is still not in the works. Market Update Jan 31, 2016

Conned by the Fed News: A History of Misdirection

The Dow came within striking distance of testing its Aug lows.

The August correction ended almost as fast as it began, so one cannot fully quantify that as a deep cleansing correction. Why do we mention this? Well if this correction maintains its current trajectory it could end up knocking a huge bunch of speculators out of the market. When this happens, a market gains a new lease on life. Thus, there is a good chance that the current correction could resemble the dot.com correction of 1998; It looked like the end was near, but it proved to be just the beginning of a massive bull market that culminated with the Nasdaq ending 1999 with a gain of 100%. Market Update Jan 31, 2016

The Foundation for a Rally: Elimination of Speculative Forces

The market landscape has changed significantly, with speculative forces nearly eradicated. This shift has laid the groundwork for a robust rally, the first phase of which has already transpired. As the markets appear overbought, it is reasonable to anticipate the Dow retreating several hundred points before continuing its upward trajectory.

Bears’ Unwavering Persistence: The Illusion of the Mother of All Corrections

Despite their profits vanishing and turning into losses, bears stubbornly cling to their pessimistic outlook, believing this is the ultimate market correction. It is essential to dismiss the half-full or half-empty glass fallacy and focus on personal investment criteria instead. Historically, significant corrections and crashes have presented valuable buying opportunities.

Embracing the Negative Rate War Game: Anticipating the Fed’s Inevitable Move

The global trend of adopting negative interest rates has continued, while the US economy’s health has diminished compared to previous years. Consequently, it is likely that the Fed will eventually join the negative interest rate movement. The initial step will involve a subtle change in rhetoric, suggesting economic conditions are not as favourable as once believed.

The Domino Effect of Lower Interest Rates: Corporate Borrowing and Share Buybacks

When the Fed lowers interest rates, corporations will be encouraged to borrow more money, which will be used to buy additional shares. Share buybacks have proven to be an effective method for boosting earnings per share (EPS). The year 2016 is already on track to set a new record for share buybacks, further demonstrating the interconnectedness of these market forces.

Am I thirsty? If you are, you drink it. If you are not thirsty, you move on and focus on more pressing matters. On the same token, the concept of a market crash is retarded. The actual premise is, do you want to invest in the market? If the answer is yes, then you need to focus on your criteria, which is all that matters. History illustrates that every big correction/crash proved to be a buying opportunity, which would be a good starting point regarding criterion. Tactical Investor

Action cures fear inaction creates terror.
Doug Horton