Awaiting FOMC news

The market had been volatile the last few weeks. It is difficult to choose a play without being slaughtered within the next few days. It seems that in such market condition, an intraday play seems to be the best strategy.

The FOMC is due to make their interest rate recommendation today (2:15pm ET). While a 0.25% increase is given, what is important is the language used - whether further rate hike will still be in the making. In this regard, I find that the market expectation is rather foolish. Which FOMC in the right mind would say that there would not be any more rate hike when inflation is still creeping (e.g. light sweet crude oil is still above $70 (abt $73.35 for Aug futures), metals prices are still high as compared to 1 year ago). Logically, the FOMC would still monitor the inflation figures and would be "data dependent" in raising future rate hikes.

Hopefully, whatever the outcome, the market can find some kind of direction. While I am bullish on some of the US companies, the rising trade and budget deficits, extremely low savings, extremely high borrowings, and high cost of raw materials (e.g. oil, metals, food, etc) painted a bearish picture of the overall US economy.

I expect great movements (and perhaps quite volatile) in the market immediately after the FOMC statement at 2:15pm ET.

As for me, I'm waiting for the right signal to short the housing stocks (e.g. BZH, KBH, PHM, DHI) once the overall market direction is clearer. While I am still bullish on the metals (gold, silver, uranium, etc) stocks, it seems that at the moment, they are market followers (i.e. follow the overall market movement).

If the market reads that FOMC would pause any rate hike for sometime, then almost any stocks would rally at least for today.


- PersianCat04 (Millionaire-in-progress)