Data &
Technology
Research
Reports
Report Solutions
Reports Library
Actionable
Strategies
Free
Resources
Simple Backtest Calculator
Simple Seasonality Calculator
The Kelly Criterion Calculator
Sentiment Geo Map
Public Research Reports
Free Webinar
Pricing
Company
About
Meet Our Team
In the News
Testimonials
Client Success Stories
Contact
Log inLoginSign up
< BACK TO ALL REPORTS

What The Fed's First Cut Has Meant

Jason Goepfert
2019-06-13
null

First cut

The probability that the Fed will cut rates is rising. It’s still only about a 20% chance in June but more than 80% in July. That will end the longest-ever streak with steady or rising rates. Following these “first cuts”, stocks have done either poorly, or really well, with no middle ground, but the positives mostly offset the negatives.

During the next month, all but two of the cuts led to a jump in stocks, and those two losses were minor. The risk/reward was skewed heavily to the upside, at least until the negative effects of the three failures started to hit.

Other assets

Other assets also saw some mixed returns, with mostly weakness in the dollar initially, then gold and commodities. Treasury note futures did well across time frames.

Among sectors, the most consistent – and biggest – winners were defensive ones like consumer staples and utilities, the only 2 sectors that averaged more than a 20% gain over the next year.

Gold bugged

Optimism on gold has jumped by 30% over a two-week period, nearly the largest change in sentiment since ’91.

For an asset that’s subject to the whims of sentiment more than most others, this has been a tough hurdle to cross.

Crude behavior

Crude oil has lost more than 2.5% during the day in 6 out of the past 15 sessions, falling to a multi-month low. Six months after the other times this happened in the past 30 years, oil returned +47%, -3%, +47%, +7%, +33%, and +44%.

Korean surge

The McClellan Oscillator for the Kospi index has jumped above 85. According to the Backtest Engine, this has happened 3 other times, all leading to volatile shorter-term returns, but gains over the medium- to long-term each time.

This post was an abridged version of our previous day's Daily Report. For full access, sign up for a 30-day free trial now.

DATA &
TECHnologies
IndicatorEdge
‍
BackTestEdge
‍
Other Tools
‍
DataEdge API
RESEARCH
reports
Research Solution
‍
Reports Library
‍
actionable
Strategies
Trading Strategies
‍
Smart Stock Scanner
‍
FREE
RESOUrCES
Simple Backtest
Calculator
Simple Seasonality
Calculator
The Kelly Criterion
Calculator
Sentiment Geo Map
‍
Public Research Reports
‍
Free Webinar
COMPANY
‍
About
‍
Meet our Team
‍
In the News
‍
Testimonials
‍
Client Success Stories
Pricing
Bundle pricing
‍
Announcements
‍
FAQ
© 2024 Sundial Capital Research Inc. All rights reserved.
Setsail Marketing
TermsPrivacyAffiliate Program
Risk Disclosure: Futures and forex trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones’ financial security or life style. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results.

Hypothetical Performance Disclosure: Hypothetical performance results have many inherent limitations, some of which are described below. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown; in fact, there are frequently sharp differences between hypothetical performance results and the actual results subsequently achieved by any particular trading program. One of the limitations of hypothetical performance results is that they are generally prepared with the benefit of hindsight. In addition, hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk of actual trading. for example, the ability to withstand losses or to adhere to a particular trading program in spite of trading losses are material points which can also adversely affect actual trading results. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results and all which can adversely affect trading results.

Testimonial Disclosure: Testimonials appearing on this website may not be representative of other clients or customers and is not a guarantee of future performance or success.