I hear a lot of people talking about how the SP500 is overvalued, and the economy is collapsing... which are both true. However, given that the Fed is holding 3-4 Trillion in reserves for the '5 Horsemen' (JPM, GS, Citi, BoA, WF), and the PPT isn't letting the markets drop.... I really don't think the market is going to collapse. There is just too much free money printed up since 2008 floating around.
Anyway, you can hedge if you like, but I wouldn't bet the house on a market selloff. This month has just been a normal retrace to the 38% fibonacci level, which just happens to near term and long term support. All the confluence says this market is going up. We might bounce off that support this week Monday/Tuesday, but I think the FOMC announcement Wednesday will eliminate the chance of a rate hike for September/October/November, which means 3 more months of higher highs for ALL markets. If the FOMC flaps its dovish wings again, as expected, we'll get a nice rally.
My Money
I am hoping for a precipitous selloff in metals and metal stocks Tuesday before the FOMC. The bigger the selloff, the more I will buy. I want to see shakeouts in oil/gold/sp500/dow for me to be certain of a dovish statement Wednesday. I'll personally be looking to pick up JNUG/NUGT on Tuesday. I will also be looking to unload my UVXY hedges.
Good Luck. Have Fun. Play Safe.
-JT
upvoted and followed You may find my work interesting @me-tarzan