The Fed’s actions will have major impact on the emerging markets.
For this reason, ahead of the Fed, we are upgrading China (ASHR and FXI), South Africa (EZA) and Turkey (TUR). The reason is that there are lots of shorts in these markets and conditions are ripe for a massive short squeeze to the upside.
The big money is positioned for the Fed to either not raise rates or raise rates accompanied by an extremely dovish statement.
If big money turns out to be right, expect a mild rally. The big money will likely sell into the rally potentially causing a sell-off.