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In more than 30 years as a financial professional, I have never seen a market anticipate an interest rate cut the way this one has. Good grief.
The "groupthink" here is that this market "deserves" a cut – not that it needs it. And that, friends, can be a dangerous perspective for the market. This market feels crowded and to some degree "bullied" higher.
In my "10 Commandments of Trading," we're talking Commandment II: Never run with the crowd; avoid bandwagons… unless you're the one driving.
About the Author
Chris Johnson is a quant - he's obsessed with building and perfecting mathematical models that allow him to predict, with startling accuracy, the direction of the markets, entire sectors, and individual securities. For the last year, he's been researching and building a new system that lets him move swiftly in and out of the hottest stocks in the market for life-changing gains - entirely on his own terms. The results of his newly-minted Night Trader system are nothing short of amazing.
Chris also contributes to Money Morning as the Quant Analysis Specialist.