About markets action on the FED day and a few days after that.

Day one; on the FED day there will be Over-Reaction.

Day two; there is usually Reaction-to-day-one-action.

Day three;  action is the best indication on how participants digested the news

"When market is bottoming, the best stocks make their lows ahead of the absolute low in the market averages. As the broader market averages make lower lows during the last leg down, the leaders diverge and make higher lows."

Anything can happen, but odds of a rate hike this week are incredibly low as it would probably sink stonks 25% in a week and that's obviously not happening.

"It's a bull market you know.........."

 

Stocks move for two basic reasons, anticipation and surprise. Every price movement is rooted in one of these two components; anticipation of news, an event, an important business change or reaction to unexpected event and surprise, whether positive or negative.

 

Opportunities.

"When considering a new project or opportunity, one of the first questions to ask is, “How do I want to spend my days?”

Make as few choices as possible that violate your answer.

Many opportunities seem exciting but actually give you less of the life you want."

Every cycle is different, but one of the hardest things to do is to sit out the sharp and fast relief rallies during primary downtrend. Every time they feel and seem real and so inviting.

An example - DOCU

"Once a market leader puts in a secular top, there is a 50 % chance that it will decline by 80 %  and an 80 % chance it will decline by 50 percent."

What is your plan ?

How are you going to get to your goal ? If you trade a short term move you give up the bigger move. If you go for the bigger move you will give up short term profits as you hold through pullbacks that never recover. There is no perfect plan. What is your plan ?

"When China sneezes, the whole world catches the flu."

 https://gisanddata.maps.arcgis.com/apps/dashboards/bda7594740fd40299423467b48e9ecf6

Not something an investor should discount. 

Economic implications are pretty clear. Lower retail sales, home construction, fuel consumption. The lunar new year increases the risks of the virus spreading but it's also a holiday for many so in some ways the industrial and supply chain impacts are muted. If it keeps spreading, prevention efforts are going to get more intense and it's going to have a more meaningful impact on growth. The responses are similar to what they were a hundred years ago during the Spanish flu. Moreover, the better the control measures (curfews/travel bans/restrictions on public gatherings/limiting public transportation), the bigger the hit to growth. There are no easy choices.

This market is very vulnerable as the indexes rallied but the number of stocks that have been participating in this rally has been narrowing. Be careful out there, consider maintaining mostly breakeven stops on profitable positions and keeping risk very tight on new commitments.

Rotation continues, bulls are gaining interest in global and small cap equities.

ZIM

                                                paying over 18% in dividends

Just remember: by the time we get to where we want to go the journey will have already ended.

"Edison failed 10,000 times before perfecting the incandescent electric light bulb. Don’t worry if you fail once."

Arguably America’s greatest inventor, Thomas Edison had an extraordinarily positive perception of life that greatly enhanced his ability as an inventor. When others might have been hopelessly discouraged after failing thousands of times in an attempt to develop an electric light, the great Edison simply viewed each unsuccessful experiment as the elimination of a solution that wouldn’t work, thereby moving him that much closer to a successful solution. We could all take a lesson from Edison. Stories abound about inventors who quit trying and gave up too soon or miners who struck gold just a few feet beyond where someone else quit digging. There are few obstacles in life that will not succumb to consistent, sustained, intelligent, positive action. When you are discouraged after you’ve failed at something, remember Edison’s 10,000 failures before he arrived at the solution that forever changed the world.

Inflation is surging.

The inflation comparisons between November and February are very easy to beat - so inflation will surge further in these months. Nevertheless, inflation will most likely peak in Q1 22 - something to keep in mind and a reason to be stalking for buying opportunities in bonds.

Moreover, market participants seem to view this inflationary environment still as transitory. For example, the two-year breakeven -- which represents the market’s view on the annual pace of inflation over the next two years -- is currently 3.3%, while the 10-year rate is 2.7%. That suggests that traders expect price pressures to subside over time.

"The farm had grown richer without making the animals themselves any richer except of course the pigs & the dogs."

"The secret to being productive is to work on the right thing—even if it's at a slow pace."

DBA

ACB - reporting earnings tomorrow

AG