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Has the Fed Finally Peaked on Bringing the ‘Pain’?

by | Sep 27, 2022 | Market Outlook, Stocks

Welcome to this week’s edition of The Big Picture With Jeff & Roger, where we discuss all things macro…

I can’t wait to get back to being in a stock-picker’s market… Because, as the kids say… this ain’t it…

“Pain” has been the name of the game for several weeks now, which is what the Federal Reserve wants, according to its members, Chair Jerome Powell in particular. 

If these people would just stop talking and go away for a few weeks, the market would be fine without all of their meddling, but I digress…

The Big Picture With Jeff & Roger

In the shortest of runs, we are historically oversold in all the major indexes, the put-call ratio, short interest — all of the big metrics institutions look at. 

But the market has been so bearish, and we’ve seen so many rallies in futures fail at the open after meeting a wall of sellers.

I like to look at the market as this big ecosystem… And right now, it’s gone from a lack of short-term buyers to bonafide, institutional selling, which is a big problem when looking for a bounce. 

People are looking at their accounts, wanting to preserve what they have left and not wanting to see it go any lower because who knows what the next two years will look like.

There haven’t been many years where the market has fallen this much. So from a statistics standpoint, there doesn’t appear to be much downside left… 

But I hate the price action we’re seeing right now. 

And the scary part is that the people in charge at the Fed created our problem almost out of thin air through horrific management of the economy. 

They are terrible at their job… I’ve been banging this drum all year, but I’m not the only one saying this. Wharton Business School professor Jeremy Siegel, who Senior Strategist Roger Scott and I both respect, had this to say this week…

“Honestly, I think Chairman Powell should offer the American people an apology for such poor monetary policy that he has pursued, and the Fed has pursued, over the past few years,” Siegel told CNBC on Monday.

The Fed created this bubble on the upside, and they’re now popping it causing violent moves to the downside because of their ineptitude. 

So we have to figure out how to trade what’s in front of us. We say this often in this environment: Now is no time to be a hero. 

About the only thing working is trading super short term and always being long and short with hedged positions. It’s like going to bed with insurance and a roof over your head no matter which way the market heads. 

I’ve been saying for months that we’re already in a recession, and there’s one thing that scares me most about a recession in this market environment. 

But I do see a potential pairs trade — where you go long one stock and short another — forming right now, so check out The Big Picture With Jeff & Roger. Let’s discuss the big thing that could make this market even worse…

Are there any topics you’d like to see me cover or questions you’d like answered? Send me an email at jeff@joyofthetrade.com! And be sure to stay ahead of the markets by subscribing to our YouTube channel and our Instagram page for all of the latest!

P.S. An Opportunity Not Seen Since 2008

Screw the S&P 500 — just look at its performance over the past month… 

The Big Picture With Jeff and Roger

Here’s the deal… You don’t have to trade this junk!

Senior Strategist Roger Scott believes he just “cracked the code” to this bear market with one pattern and 146 little-known stocks…

Stocks that have NOTHING to do with the S&P 500. In fact, you won’t find a single one of them in the index. 

He’s not talking about penny stocks, speculative biotechs or crypto… Forget all that.

Roger is talking about rock-solid companies in the middle of parabolic trends… 

Stocks That Shrug Off Global News Like It’s Nothing

WRITTEN BY<br>Jeff Zananiri

Jeff Zananiri

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