To The Moon

Fellow 🐯🐯🐯 let me prep you on what might happen when the FOMC meeting outcome is presented:

(1) Market will be volatile‼️ Don’t rush in just because it’s 0bps or if you see the market🚀🚀🚀

(2) There might be a different market response when the rate is announced 🆚 when Powell speaks, especially when the Fed’s Dot Plot is announced🚨

⭐️⭐️⭐️ For example, if 0bps is announced, stocks & futures will🚀 then when Powell speaks, he explains it’s just 0bps for this month so as to stabilise the financial situation, & that future rate increases will still be required, then stocks & futures might drop📉. Then if Powell adds that inflation is still not within the 2%🎯 & the Fed is committed to this & the Dot Plot shows that the Dec’s forecast of 5% to 5.25% needs to be adjusted upwards & a mild recession is inevitable to bring inflation down, then stocks & futures will crash💥💥💥😅

🤔💭So What Is The Fed’s Dot Plot❓

⭐️ It’s a chart that summarises the FOMC’s outlook for the federal funds rate.

⭐️ It is published quarterly with the latest one being Dec 2022. The next one is supposed to be out in less than an hour‼️

⭐️ Economists & investors watch this closely👀 for indications on the future trajectory of the federal funds rate.

🚨 Even though the Fed’s Dot Plot is a guide to future rate rises (which we are all interested to know when the rate hike will eventually pause), the Federal Reserve is data-dependent, meaning their monetary policy depends heavily on economic trends, inflation, & global events.

🤔💭 How Does The Fed’s Dot Plot Work❓

⭐️ Up to 19 Fed officials can contribute a dot anonymously (meaning no dots are “identified”) to each varying calendar year of the FOMC dot plot to indicate where they believe the federal funds rate should be.

⭐️ The 19 Fed officials who can contribute a dot to the FOMC dot plot include 7 members of the Board of Governors of the Federal Reserve System & presidents of the 12 regional banks.

⭐️ The actual number of dots per year can be lower than 19 if there are vacancies on the Board of Governors of the Federal Reserve System.

🤔💭How to Interpret the FOMC Dot Plot❓

⭐️ The X-axis represents years, while the Y-axis represents the target fed futures target rate.

⭐️ Each dot represents the middle of a range. For example, in the 2022 column, the dots plotted at 4.375% actually represent the range 4.25% to 4.75%.

⭐️ Looking at the Dec 2022 dot plot, a majority of Fed officials (10/19) believe that the Fed Rate should be between 5%-5.25% for 2023, & 7/19 officials believe that it’ll be 4%-4.25% for 2024.

🚨 Since the rate is now at 4.58%, it looks like there will be 2-3 more 25bps increases in 2023, BUT Powell in his recent testimony on 8/3 stated that the Fed believes that the terminal rate for interest rates (where the Fed) will stop raising rates, might be higher than the current projected stopping point of 5.25%-5.50%, which means More Than 3-5 25bps increases🐻🐻🐻

⚠️ The worst the dot-plot later = the more hikes are needed = more 🏦🏦🏦 will sell-off today & recession risks higher = investors will sell-off stocks & go to a safer haven of gold, maybe crypto (🤷🏻‍♀️ why people think crypto is safe) = 🐻🐻🐻Market even though hot favourites like NVDA & AAPL is likely to be minimally impacted $Coinbase Global, Inc.(COIN)$ Bullish $UBS Group AG(UBS)$ Bullish$Credit Suisse Group AG(CS)$ Bearish$NVIDIA Corp(NVDA)$ Bullish$Apple(AAPL)$ Bullish

Fellow 🐯🐯🐯 hope this dot-plan sharing will come in handy for your investing decisions in less than an hour❣️Do follow me if you enjoy reading analytical stock research🔍 presented in a fun & easily understandable way😉 & for the Latest Stock & 🗞🗞🗞 Updates🕵🏻‍♀️❣️

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As usual-🤔💭 Consider POV & Actions of Investors + 👩🏻‍💻👨🏻‍💻 Research + 🗑FOMO & Greed = Investing Wisely 🤓🤗 + Accumulating Wealth 💵💰

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