Market Direction Model - Model switches to SELL on February 10, 2022

Published:

10 Feb 2022 09:12 ET

MDM has switched to a SELL signal.

The CPI came in higher than expected. 0.6% vs est 0.4%. CME Futures is now pricing in 6 rate hikes for this year as well as 50/50 odds of a 50 basis point hike at the Fed's next meeting. The dead cat is alive. #schrodinger

For the first time since 2018, Fed Chair Powell changed his stance on QE by becoming more hawkish due to spiking rates of inflation. 30- and 40-year highs in inflation have been observed by major countries. As a consequence, we may very well see a market correction in the major avgs of 20% or more if history rhymes.

The global trend has been to tighten since more than a billion people live with double digit inflation which is destroying savings accounts as well as the middle and lower classes. A number of countries have started to hike rates including the UK, South Korea and New Zealand.

List of Potential ETFs for investors:

1-times inverse

PSQ - NASDAQ 100 1x bear.

2-times inverse

QID - NASDAQ 100 2x bear.

3-times inverse

SQQQ - NASDAQ 100 3x bear.

TECS - S&P Techology Select Sector 3x bear.

NOTE: This is a suggested list. Investors may wish to become acquainted with the full range of available ETFs, and should make an effort to understand how these ETFs are created and what their components are, as well as being aware of the downside risks involved, especially with leveraged ETFs. Certain ETFs may be more appropriate depending on one's risk tolerance levels. Typing in keyword 'ETF' into the FAQ keyword search bar or going here https://www.virtueofselfishinvesting.com/faqs/search?p=1&q=etf and visiting this site https://etfdb.com/ can be instructive.

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