Who cares bout FED?

"Do you think the Fed will cut rates again?"

My easy answer was "Yes, several times more!" And that answer is based
on
the simple fact that interest rate cuts, just like interest rate hikes,
tend to come in long strings.

But my real thought is this. When everybody in America is wondering
whether the Fed will cut rates again, you should probably be thinking
about something else!

The reason for this thought is simple contrary opinion. When everyone
is
looking at the same indicator, that indicator tends to stop working.
If
it did, making money in the market would be easy ... and it's not easy.

There's no question that interest rate cuts in general are good for the
economy and thus the stock market. And there's little question - at
least
in my mind - that the Fed will cut rates again. But now that everyone
is
focused on the Fed, I'm confident that the more important clues to the
future of the market lie somewhere else.

So where to look? Non-farm payrolls? Consumer non-durables? The
price
of oil? The price of steel in China? No doubt all are important at
some
level. But for my money, the very best indicator is the market itself,
and when I look there, here's what I see.

Trends are up, but overextended, suggesting that a normal correction is
likely. Our Hi-Lo Alert, which measures the number of Dow stocks above
their medium-term moving averages, is at its highest point since May,
just
two weeks before the market got very rocky and embarked on the course
that
took it down to the August low.

Now, that doesn't mean we're in for a repeat of the big summer
correction,
but it does suggest to me that building a little cash here might be
prudent.