Published By Banyan Hill Publishing | | | | Published By Banyan Hill Publishing | | | | Banyan Nation, Fifty-two days.
That’s how much time we have until the Federal Reserve’s next meeting and its next interest rate decision.
A lot can happen in 52 days. That’s close to two months away. But that hasn’t stopped traders from placing their bets on what they expect the Fed to do next.
And it seems they expect the Fed to do a whole lot of nothing.
The CME FedWatch Tool, which calculates the odds of Fed moves based on the buying and selling decisions of interest rate traders, is currently showing an 80% likelihood that the Fed keeps rates unchanged at the next meeting.
There’s a 20% probability that the Fed hikes by another 0.25%.  (Click here to view larger image.) (From CME Group.) As I mentioned on Friday, Chairman Powell is being noncommittal. When asked about his plans, he essentially shrugged and said he’d look at the data on a “meeting by meeting” basis.
We’ll see. It’s likely going to depend on what happens in the reported inflation figures between now and then. The latest Consumer Price Index inflation numbers had inflation falling to 3%, with core inflation hanging in at around 4.8%.
With the economy humming along strongly, my best guess is that inflation ends up coming in hot next month and the Fed ends up raising again.
Meanwhile, on the other side of the globe… The Bank of Japan’s Hawkish Hint Rumors spread on Thursday that the Bank of Japan was considering getting a little more hawkish. That was all it took to send the market lower, snapping the Dow’s 13-day winning streak — its longest since 1987.
Mind you, the Bank of Japan didn’t actually say or do anything. It was simply the reported rumor that they might allow interest rates to rise modestly. And that was enough to send markets sharply lower, half a world away.
That’s how sensitive the market remains to central bank actions … and again, the next potential move by the Fed is just 52 days away.
For now, the general trend remains higher. But given the sensitivity to moves by the Fed and other central banks, we should assume it’s going to be a bumpy ride.
And that’s OK. We’re focusing on long-term mega trends that should outlast whatever the Fed chairman’s passing fancy is on any given day, like electric vehicles and artificial intelligence.
And about that, let’s see what the rest of the team has been working on this week. | | | During a recent special event, we launched our breakthrough, new AI algorithm called An-E ... and showed many of its past predictions and just how accurate they were (often precise to within a tenth of a percent).
Well, during the event we also showed what An-E's predictions were for three of the most talked about stocks on the market one-month into the future.
You can see what those predictions are by going here. | | | Weekly Recap  - AI Prediction: Your Next Trade Alert!
As far back as 1997, an earlier iteration of artificial intelligence defeated the world’s best chess player. A decade later, the Chicago Cubs broke a century-long World Series drought by using data analytics.
And today, AI can screen for cancers and other diseases better than a doctor with decades of experience. Now, AI is revolutionizing investing, and An-E the AI can predict market moves 30 days in advance.
- 📢 2 Mega Trends to Buy Today
Electric vehicle (EV) sales just crossed the 4 million vehicle mark. And this is happening just 10 months after crossing the 3 million vehicle mark. Demand for EVs is exploding, and sales are expected to be close to 11 million by 2025 (and over 28 million by 2030), just seven years from now.
And the craziest part of all? AI is growing even faster!
- What They Won’t Tell You About Diversification
Diversification is great at reducing risk. Unfortunately, it can also be great at reducing profits. You can’t beat the market if you own the market via an index fund or just a really large portfolio of stocks.
If your primary goal is to GROW your wealth (and not just preserve it) then you should avoid diversification like the plague! Great fortunes weren’t built by holding 50 or more stocks in a portfolio. They were made by people who identified an outstanding business, led by top-tier CEOs — and held out for the long term.
- Your Mind: The Biggest Threat to Profitability?
Newsflash: Investors aren’t always rational! We are emotional beings, and our emotions can often lead us to make poor investment decisions. But the good news is that it’s not hard to identify the biases holding us back. There are a handful of common cognitive biases that tend to wreck portfolios, and simply being aware of them is the first step to conquering them.
- Going Live With Wednesday Windfalls
Do you want to trade options like a pro? Adam O’Dell is announcing a new change to his Wednesday Windfalls options trading service. If you were already a subscriber, you’re now getting access to his longer-term options trading strategy, Max Profit Alert.
Stay Tuned for the Monday Podcast! 🎧  I’ve been absent for a few weeks, but I’ll be back in the host’s chair on Monday for The Banyan Edge Podcast. Adam will be joining me, and we’re going to expand on what Mike said about behavioral biases.
That sounds stuffy and complicated, but it’s actually brutally simple. The stock market is neither efficient nor rational because the buyers and sellers that make up the market — be they professionals in finance or Main Street investors — are neither efficient nor rational.
But if you know exactly how and why investors aren’t rational, you can build trading strategies to profit off their craziness. Adam has been doing it for years, and he’ll be sharing some of his secrets with us.
Until then!
Charles Sizemore
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