Will the Fed Be More Aggressive?

(6/13/22) Market Futures are sharply lower, with the Dow set to open in negative territory--which could be the low-point of the day. The hotter-than-expected inflation print released Friday is worrying investors that the Fed might move more aggressively in hiking rates in the near-term. That announcement comes on Wednesday, so markets are trading off ahead of the news. We expect the FOMC to follow thru on a 50-bp rate hike; of more interest will be the Fed's commentary for hints of subsequent actions later this Summer. Add to the mix a $3.2-T options expiration this week, and you've got a great recipe for market volatility. If markets open lower, we think it will trigger a MACD Sell-signal, unfortunately, since the Buy-signal was only recently established, with a subsequent rally; that rally is done. We believe it's best to use any intra-day rallies to lift exposure raise some cash--maybe even put in some shorts: If we break through market lows today, there is the likelihood of more downside in the near-term. Once we get past Wednesday's Fed announcement and Friday's Options Expirations, we can begin to think about what comes next. For the moment, the watchword is protect your portfolio.
Hosted by RIA Advisors' Chief Investment Strategist, Lance Roberts, CIO
Produced by Brent Clanton
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