Don't Fight the Fed - A Hard Lesson on Rate Hikes

I've been in this game long enough to know better, but sometimes the market throws a curveball, or more accurately, sometimes I'm just an idiot. Back in early 2022, as the Fed started telegraphing its intentions to get serious about inflation, I made the classic mistake of thinking I knew better. I saw the initial rate hike as a 'buy the dip' opportunity, especially in certain tech names that had already taken a hit. My logic, or lack thereof, was that the market had already priced in the hikes and the worst was over.

Well, the Fed wasn't bluffing, and neither was the market's reaction to sustained tightening. I kept trying to average down on positions that were fundamentally sensitive to higher rates, ignoring the clear signal from Powell. It wasn't just a single mistake, but a cascade of poor decisions driven by anchoring bias and a refusal to admit I was wrong. The drawdowns compounded, and I bled capital for months trying to catch a falling knife that was being pushed down by the most powerful central bank in the world. The lesson, etched painfully into my P&L, is simple: don't fight the Fed, especially when they're determined to crush inflation. Price action follows policy, and ignoring that is just financially negligent.