The Fed did the expected yesterday by lowering interest rates ¼%. For Wall Street, it turned out to be a disappointment since false hope of a ½% cut was not met. The reaction was fast and furious, and all major indexes retreated sharply with the Dow dropping some 300 points.
It will be interesting to see if this pullback was a one-day event and if the markets can resume their upward path again, which they started the beginning of December. Here’s what I can’t figure out. The markets are usually in an anticipatory mode by focusing on possible events some 6 months in the future. The worsening housing market and credit crisis would certainly qualify as an event that can have some dire impact, yet Wall Street seems to completely ignore the implications. Maybe the old saying about climbing a wall of worry has something to do with that…
In the meantime, the major trend continues to be murky and more time is needed to sort out where we’re going. Our Trend Tracking Indexes (TTIs) are offering a mixed picture with the domestic one still sitting above its long-term trend line and the international one still in sell mode:
Domestic TTI: +5.19%
International TTI: -0.61%
Below please find the link to the most recent ETF Master list, which has been updated with yesterday’s closing prices. This will enable you to work with more recent data. You can download the file at: