Roller Coaster Market

This topic contains 5 replies, has 2 voices, and was last updated by  TS Paul 3 years, 11 months ago.

Viewing 6 posts - 1 through 6 (of 6 total)
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  • #16686

    Bruin

    The Market these past weeks in like a roller coaster, one day up and next day down, wonder why with positive job reports seems that it drags the market down, you would think it would boost the markets for positive gains.

    #16693

    Stephan
    #16694

    TS Paul
    Keymaster

    The article Stephan posted in the reply above pretty much nails the reasons I would give for why the market would decline on good news. In the view of many – including the knuckleheads who day trade based on information which effects the market over many months, not days – the strong jobs report makes it more likely that the Fed will raise short term interest rates sooner rather than later.

    At this point, consensus is that the soonest we might see such a rate hike is September (with October more likely), and the market will be up and down daily between then and now. But for the hyperactive traders who feel like they have to trade any news which comes across the wire, this counted as an event worth trading on.

    The TSP Allocation Guide www.TSPallocation.com

    #16695

    Khanh Barker

    Thank you Stephan for posting the article and TS Paul for your reply, how do you feel about moving all the money in your TSP fund into the G Fund when the Fed raises interest rates for awhile, since I get the feeling that the market is going to take a big dip when that happens, then transfer the money back into the S or C funds, only problem is I guess one does not know exactly when the rates are going to be raised.

    #16699

    Stephan
    #16700

    TS Paul
    Keymaster

    That won’t be the strategy which I follow in my Thrift Savings Plan – I just don’t think the market’s reaction to interest rates is that predictable and the market may well surge once the band-aid finally gets pulled off.

    I expect plenty of volatility around this event, and there is a good chance we will see a genuine 10%+ correction in there at some point. But I don’t have any way of predicting when those will occur, so I will stick with a longer term strategy and stay in the stock funds for as long as the US economy continues to recover.

    The TSP Allocation Guide www.TSPallocation.com

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