Quote:
Originally Posted by Parkview_Pirate
Plenty of factors at work, including the rate hikes which still probably aren't priced in. Yesterday's sell off reminds me a bit of the market tantrums back in 2012 when rate hikes were discussed - perhaps a message for the new Fed Chair Powell?
Definitely had to be some margin calls too, and now some speculators will be left high and dry by their brokerages. If the dollar actually strengthens during the next big flush, things could crash pretty quickly. It only moved up a buck the last three trading days from 88.44 to 89.48. What's the market do if it goes back to 100?  |
Another factor I use from Martin Zweig is called "Installment Debt Non-Seasonally Adjusted".
You buy when it is falling and drops below 9%.
You sell when it is rising and exceeds 9%.
It jumped from 7% to 12% last November. That might have been a foreshadowing of what was ahead.
With the rate hikes it is now getting more expensive to service the debt. Think about all the people who have adjustable rate mortgages. Their mortgage payments are increasing.
Some people may need to sell stocks in order to have cash to pay bills. Or they are just taking some profits and will use it to pay down debt.
