Today we got even more evidence that the Federal Reserve's near decade-long supercycle of interest rate suppression has simply not worked.
Retail sales today, reported the biggest drop in 16 months and despite a money printing binge unlike anything ever seen in the history of the world-the Federal Reserve continues to miss its inflation target.
The immediate response to this bad economic news was a selloff in the financial sector.
The reason for the selloff in the financial sector is very simple, the Federal Reserve will have to back off of their monetary tightening cycle.
Later on today, we are going to hear from the Federal Reserve regarding monetary policy and I still fully expect to hear that the Fed is in fact going to raise the federal funds rate 25 basis points. However, in light of the continued bad economic news, of which we keep getting round after round of, I believe the Fed will strike a dovish tone with regard to for the rate hikes-and this is where opportunity lies.
Capitalize on this.
Because I believe the Federal Reserve is going to strike a dovish tone with regard to further rate hikes later on today, I expect to see some pressure on the financial sector and a rotation back into tech, this is opportunity my Lions!
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Gregory Mannarino