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Weekly Market Newsletter

Weekly Market Newsletter

March 03, 2020

No Non Sense News

Today is Tuesday, March 3 and it is 4 PM.

I wanted to give everyone a quick update now that the Fed has stepped in to support the market with a surprise 1/2% interest rate cut. Last week’s market pull back triggered by Corona Virus fears led the Fed to take action. The bond market and the overall yield curve had already adjusted and now the Fed has followed suit.

So here is where we stand. Day Hagan issued a chart showing the degree of the pull back.

From a technical standpoint, the case can be made that the worst of the correction now may be over given the 50% retracement of the December 2018 to February 2020 rally. Of course, no one can say with absolute certainty if the worst is over. The market could retest the recent low at some point or we could simply continue higher from here in a V shaped recovery rally.

My guess is that with the FED stepping in with such a supportive and aggressive monetary move, it may well force institutional sellers to re-think their selling strategy. Remember, market reversals tend to occur during periods of peak fear and accompanied by significant volume. We had both of these last week.

Please know that we are continuing to monitor the markets very carefully. If things change and we begin to break down again, rest assured we will evaluate the proper course of action at that time. 

Please call us at any time if you have questions or concerns.

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