S&P 500 Forecast: Jerome Powell Crushes S&P 500

(MENAFN- Daily Forex)

  • The S&P 500 E-mini contract was initially positive during the day on Wednesday, but after the Federal Reserve statement and press conference, we started to see a huge“risk off” type of trade come into the picture.
  • This makes a lot of sense, because there's no reason to think that we are going to remain bullish for much longer.
  • What was interesting is that the market at one point during the conversation that he was having at the press conference tried to read something dovish out of it.

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However, the adults came back and started pummeling the market. We are heading towards much higher interest rates, and of course slower growth. Ultimately, I think this is a situation where you have a market that needs to go much lower, but unfortunately there are people out there still pushing a narrative that is completely false. We are starting to see them capitulate a bit, but we are nowhere near the bottom. I do think that anytime this market rallies, you need to be thinking about selling, and I have for a long time said you almost never want to short these indices in America, because they are far too manipulative, and of course are not equal weighted. However, this time might actually be different as some of the big stocks out there are starting to get hammered.Prepared to Short this Market

Unfortunately, Wall Street has a huge generation of traders that have lived on Federal Reserve handouts, and now are trying to figure out what to do with themselves. Because of this, I think that we will continue to see a lot of nonsense, but at the end of the day this is a market that is going to reach the bottom again, and perhaps even punch through it. If it does, we could see a massive drop in rather short order. I don't like the idea of going“all in” when it comes to shorting, but quite frankly I cannot give you reason to get long at all. The 3800 level has been pierced again, and now it looks like there is a good chance that we then go looking towards the 3700 level in rather short order. I do not stand be buying here, but there's always somebody willing to do so. The economy is about to get a lot worse, not better, and the Federal Reserve has to keep its monetary policy type.

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