Yesterday, the Fed raised interest rates by one quarter percentage point.
But this is no surprise per se…
Coming into this year, the Fed was on the fence about three or four total interest rate hikes, but it seems officials have settled on four.
You may catch yourself wondering why these interest hikes happen – and here’s a few reasons…
- The unemployment rate is low – as of right now, the employment rate is sitting at 3.8%, which is the lowest since 2000.
- The economy is strong – as reflected in the unemployment rate.
- Inflation is rising.
- Audits by the U.S. Inspector General Revealed Tens of Thousands of Americans Have Been Underpaid by up to $23,441… (In fact, we’ve put an entire report together on this situation, including how you can claim your lump-sum check within five days… check it out right here)
Now, I’m sure you’re probably wondering what this all means for your bottom dollar.
So here’s the deal…
What the Rate Hikes Means for You
A strong economy is one side of the interest rate hikes – but another contributing factor is the time of year.
And by that I mean we are coming off quarter one earnings.
Q1 earnings came out and showed pretty impressive numbers. As of May 31, 78% of the 97% of companies in the S&P 500 have come in above their estimates. Along with this, they saw an increase in share price of 0.2% over the two days following their reported earnings. This isn’t as big of increase as the market is used to though, as we typically witness a 1.1% increase in price over the same period of time. But compared to the overall growth of the S&P 500 – a whopping 24.6% since March – that less- than-impressive move is a small blip on the radar.
Now, this combined with the interest rate hike creates an interesting set-up for the next earnings season as this recent hike could affect many company’s earnings per share (EPS) and revenue.
The next earnings season (quarter two) – and subsequent market reactions – and the reaction to earnings and revenue reports, could be a crapshoot, depending on how companies are impacted by this hike.
That’s why I did a quick scan using one of my proprietary tools to identify the top moving -higher and lower- sectors year to date.
This program is only one of my many tools – like my complex computer program based on a virtually invisible aberration that I discovered.
It’s a unique convergence of three data channels that are hidden on just about every stock chart…
And is the reason readers are getting the chance to reel in extraordinary gains like 100% on FB in two hours, 80.37% in 2 days, and 101.92% in one day. (To see how this incredible technology works, and how you too can get in on these fast-moving plays, go here now).
In fact, I can set the Money Calendar to find me just the candidates that have made a higher or lower move nine out of the last ten years (a 90% success rate). Here are the sectors and their percentage increases, year-to-date.
The Best Way to Play the “Movers” of The Market
Now, there’s two ways to play these moving sectors…
If you’re going for the sectors moving higher, like XLK or XLY, consider using a long call or a long call loophole spread.
And if you’re going for the sectors moving lower, like XLP or XLU, consider using a long put or a put loophole spread.
Now, as I always say, be sure to discuss these options with your financial advisor to decide which decision works best for your portfolio…
By the way, I’m sharing my next Million Dollar Strategy with my Fast Fortune Club next week. I’ll be sharing, step by step, how to double your money on gold in just 30 days.
Now, we won’t be talking about junior minors, bullions, or stocking up gold coins…
That’s the old-fashioned way.
You see, I’ve uncovered a pattern so obscure… so unique… that no one else is watching… And it can help turn the smallest gold nonevents into triple-digit returns.
Check out the details right here, including how to secure your spot in this special class.
To your continued success,
America’s #1 Pattern Trader