The whole world is now anticipating a FED rate hike of 0.25% by tomorrow. What will be interesting to watch is will they do just one more after this or will there be two more? Or what if they throw a a curveball to the markets and raise rates to 0.50%?
What does the charts say and where are we now before the FED announcement? Check out the charts and analysis below!
Catch me in my live training events! (quick plug)
The heart of why I do this seminars is I want to build a generation of Filipinos with the right foundation in stock investing. I want to bring smart investing to every Filipino around the world!
Stock Smarts Manila — March 25 – April 1, 2017
Stock Smarts Japan — March 18 – March 20, 2017
Stock Smarts Davao — April 29 – April 30, 2017
Stock Smarts Singapore — May 20 – May 21, 2017
#ICON2017 — May 27, 2017
Stock Smarts Australia — June 17 – June 18, 2017
Stock Smarts Iloilo — July 29 – July 30, 2017
Mid term Sideways
The market closed today at 7,253.79 -7.96 (-0.11%) with relatively no conviction at all. Looking at the chart from the start of the year it has pretty evident that the market over the mid term is flat and moving sideways with a very short range of 7,148 to 7,340. This just represents a very narrow 3% channel where the market is oscillating back and forth on. The sideways movement also shows the indecision of the market in relation to this rate hike.
Major Resistance
The market still has not broke above the major resistance of 7,450. Unless the market breaks above this we will not turn bullish with a strong push upward. We must breakout of this level for the market to have any conviction moving forward. Should we breakout of that price range, it’s fair game to bring the PSEI to 7,721.
What if a breakdown happens instead?
Should the market breakdown, the next drop would bring it to as low as 7,040 and the PSEI still remains bearish over the long term.
Priced in?
There’s been a lot of talk that the rate hike has already been priced in and that should the FED rate hike happen it wont adversely affect the markets anymore. However it’s not our goal as traders and investors to guess if it has been priced in or not but rather to follow what the trend is telling us and base our actions on whether the markets would breakout out or if it reverses downward. I’m excited on how this all plays out tomorrow! Catch me at 9am at Bloomberg Philippines as we talk more about the FED rate hike as it happens!
#ICON2017
