FYI: This week’s Fed meeting will provide gutsy contrarians with yet another opportunity to exploit investors’ tendency to jump first and think later. I’m referring to the meeting of the Federal Reserve’s interest-rate setting committee on Tuesday and Wednesday of this week. The press release announcing the Fed’s decision will be released at 2 p.m. ET on Wednesday.
The contrarian strategy: Wait a bit after the release — perhaps 30 minutes — to see if the market has a sharp reaction one way or the other. If it does, then bet that the market will soon correct that initial reaction and move in the opposite direction.
This strategy makes sense for several reasons. First, the Fed hates surprises, going to great lengths to telegraph to the markets in advance what its actions are likely to be. Second, whatever the Fed decides to do with interest rates will have relatively little impact on U.S. corporate profits in coming months and years.
Regards,
Ted
https://www.marketwatch.com/story/how-to-make-money-from-the-feds-meeting-this-week-2019-06-18/print
