The FED Ends The $6 Trillion QE4: How The Markets May React

Summary

  • On March 9th, 2022 the Federal Reserve conducted their final open market purchase effectively ending the Covid QE program started in March 2020.
  • The Fed meets again on March 16th in the next FOMC meeting to decide on interest rate increases and steps to address rising inflation.
  • This article looks at the impact of the prior three quantitative easing programs and subsequent market effects after each program ended.
  • A major focus is on the quantitative tightening period and how that may again impact markets in 2022.
  • QE periods were the most positive for the S&P 500 returns, while the QT activity in 2018 was the most negative.
  • Looking for a helping hand in the market? Members of Value & Momentum Breakouts get exclusive ideas and guidance to navigate any climate. Learn More »

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Introduction

This article looks at the potential market impacts of ending the fourth and latest Quantitative Easing (QE) program by the Federal Reserve. We have three prior QE programs to review for analysis. In addition, several tapering periods and a Quantitative

This article was written by

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JD Henning is a Finance PhD, MBA, investment adviser, fraud examiner and certified anti-money laundering specialist with more than 30 years trading and investing stocks and other securities. JD runs Value & Momentum Breakouts where he identifies identify breakout signals and breakdown warnings using technical and fundamental analysis.

Signals from his proprietary Momentum Gauges® not only alert subscribers of market changes, but the strength of markets for short term breakouts or breakdown warnings across 11 different sectors. Top stock and ETF selections use technical and fundamental systems in proven financial studies. Value & Momentum Breakouts is the place to build your own optimal portfolio mix with a community of like-minded investors and traders. Features include a Premium Portfolio, bull/bear ETF strategy, morning updates and an active chat room. Learn more.

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