Market Direction Mid Week Update©

Market Direction: BEARISH alert issued 10/27/2016

The Federal Reserve on Wednesday signaled that the time for another interest-rate hike is approaching and it doesn’t need much more evidence before moving.

The Fed policy committee voted 8 to 2 to maintain interest rates in a range of 0.25 to 0.5%.

Financial markets widely expected Fed inaction at this meeting and U.S. stocks DJIA, -0.43%  improved slightly right after the Fed statement was released, but remained in negative territory on the day.

“The committee judges that the case for an increase in the federal funds rate has continued to strengthen but decided, for the time being, to wait for some further evidence of further progress toward its objectives,” the Fed said in its policy statement. The Fed said inflation has been moving up toward its 2% target since the beginning of the year.

The addition of the word “some” was a subtle hint the central bank was inching closer to a December rate hike.

Still, the Fed statement did not include the phrase “next meeting” that economists said would have been a blatant signal that it is prepared to raise interest rates. The central bank used that wording last year to signal it was prepared to raise rates.

Read: Fed expected to tee-up December rate hike
 
With odds of a December move already close to 70% before the statement was released, economists said the Fed didn’t need to send such a blatant warning.

“Why push market odds even higher?” asked Kevin Cummins, senior U.S. economist at RBS in Stamford Connecticut.

$tockMarketDirection proprietary model is currently BEARISH. We strongly encourage you to monitor positions closely, exercise proper money management strategies and follow us at $tockMarketDirection for ALERTS we may issue advising a change in the current market direction. Stay tuned and follow us. If you have a testimonial or comment of how this website has helped you we would like to know, email us. Share with a friend.

The all-time lows since our initial recommendation to go SHORT this market. Here is how the markets have performed:

Stock Market Direction Recommendation (10/27/2016)
Dow	down 237.79 points a 1.31% gain	11/2/16
Nasdaq	down 118.41 points a 2.27% gain	11/2/16
S&P 500	down 39.04 points a 1.83% gain	11/2/16

Related Link: http://www.stockmarket-direction.com/