Waiting on The Fed

Nov 3, 2021Trade Ideas

We’d love to hear how you’re doing with these trade ideas.

Earlier this week, for example, we mentioned Twitter (TWTR), as it traded at $53.50. It’s now up to $54.16 and is still oversold.

Today, we need to stay on the sidelines.

That’s because the Federal Reserve may start cutting back on the amount of bonds it buys every month as it steps away from historic levels of support.

The Fed needs to be careful, though.

“Talk up the tapering too much, and investors will get nervous that interest rate hikes are coming. Soft-pedal the move too much, and the market could think the Fed is ignoring the inflation threat. There’s risk to both too much optimism and too much pessimism that the FOMC and Chairman Jerome Powell will have to avoid,” says CNBC.

Since our crystal ball is in the shop, we have no idea what Powell will say later. With that, there will be a good deal of uncertainty and volatility leading up to the announcement.

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