After the Fed Chairman Jerome Powell's speech last week, the market take the message that Fed is going to slow down the rate hike, the rally is so hard, but the market is wrong pricing the Fed intend.
in the speech
Powell said, "We are tightening the stance of policy in order to slow growth in aggregate demand. Slowing demand growth should allow supply to catch up with demand and restore the balance that will yield stable prices over time. Restoring that balance is likely to require a sustained period of below-trend growth."
Fed is intended to slow the growth below-trend, so the Market is still too hot now in the view of Fed and the control of inflation is now successful at this moment.
Powell continue, "Despite the tighter policy and slower growth over the past year, we have not seen clear progress on slowing inflation. To assess what it will take to get inflation down, it is useful to break core inflation into three component categories: core goods inflation, housing services inflation, and inflation in core services other than housing."
DJI's weekly Stochastic is over bought and have started to turn South again. it's a good time to Sell DJI.
in the speech
Powell said, "We are tightening the stance of policy in order to slow growth in aggregate demand. Slowing demand growth should allow supply to catch up with demand and restore the balance that will yield stable prices over time. Restoring that balance is likely to require a sustained period of below-trend growth."
Fed is intended to slow the growth below-trend, so the Market is still too hot now in the view of Fed and the control of inflation is now successful at this moment.
Powell continue, "Despite the tighter policy and slower growth over the past year, we have not seen clear progress on slowing inflation. To assess what it will take to get inflation down, it is useful to break core inflation into three component categories: core goods inflation, housing services inflation, and inflation in core services other than housing."
DJI's weekly Stochastic is over bought and have started to turn South again. it's a good time to Sell DJI.