I have increased my leverage to a positive factor of 2 for investing in the S&P 500. The 1-day and 1-week ranged forecasts are positive. The 1-month ranged forecast is marginally positive. The 1-year ranged forecast is still negative.
Regarding the FOMC meetings in two days, I tried modeling modest parallel interest rate shifts up and down on longer term interest rates as of tomorrow. Either way the forecast remained positive, which has me wondering if the stock market could see an increase with any size rate decrease and the size of the rate decrease might just amplify the size of the positive stock reaction. Regardless, I will peraonally remove leverage from my investments before the announcement on 9/18, as I have limited confidence in my model’s ability to model the flow through effect of rate cut announcements. FOMC announcement days are a small fraction of the overall data, and reactions today are much more rapid than years and especially decades past, not to mention the Federal Reserve is far more transparent today, which in theory should make reactions less frothy.