Janet Yellen got a real-time lesson this afternoon in how to choose your words carefully. In mentioning that a "considerable" period is six months (between the end of QE in the fall and rates rising in the spring of 2015), she unwittingly triggered sell orders from the "ready-fire-aim" crowd.
Interestingly, but perhaps not surprisingly, the S&P 500 (INDEXSP:.INX) dropped directly to the 1850 support, where it bounced in kind. It's funny how those levels work.
She'll have an opportunity to backtrack and qualify, consistent with the recent history of the Fed, unless this was her way of letting some air out of the trial balloon. Personally, I thought she did a pretty good job for her first time out of the gate, faux pas aside.
One item of note: The financials held tough throughout the selling, which may have been the single biggest tell of the day.
Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at email@example.com.
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