FOMC: Crystal Ball Time

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By Biiwii

Let me gaze into my crystal ball, with the confidence of a genuine guru* and the vision of a mystical Swami. Sifting through my notes about leading indicators, low unemployment, but also cratering public confidence, I see… (not that you should give a damn what one faulty little participant sees)… but bear with me now as I render the great forecast…

I see the Federal Reserve folding again today, perhaps with some stern words imploring us to stay vigilant for a rate hike coming before year end. In this scenario another small chink in the armor of impenetrable post-2011 confidence in these clowns would be had.

clowncar, brought to you by FOMC

Until today I had actually been leaning toward the other scenario, that the Fed finally comes through in a show of strength, all the while with QE 4 in its back pocket. Actually, I am about 55%-45%, so the rate hold view is just a small lean.

The reason for the shift actually has little to do with the reasons we might find for a rate hike or rate hold. It has more to do with the stock market, which has chosen to stay on our plan, laid out weeks ago, for a strong post mini-hysteria bounce. In other words (and this is still a guru-like prediction here, which you should always treat as a side show), an FOMC roll over could provide the necessary burst of euphoria to get us to and perhaps even through our Resistance #2 (SPX 2040) and burnish peoples’ happiness again.

That could be a great bearish setup.

* You’re right of course, there is no such thing! Only people promoting themselves as such with a big boost from the mainstream media, which is inherently lazy in its sourcing.

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