Shervin Pishevar argues that 200-day moving averages may lose credibility amid rising interest

Shervin Pishevar is not exactly a household name. But the companies that the prolific venture capitalist and entrepreneur have founded and helped to grow certainly are. Shervin Pishevar has been behind the creation of some of the most important companies in the world of tech. These include such well-known firms as Virgin Hyperloop, Airbnb and Uber. Shervin Pishevar has personally founded companies ranging from WebOS to Social Gaming Network.

Although he has little free time, he somehow is able to maintain one of the most-followed Twitter accounts of anyone in the world of tech. Shervin Pishevar often holds forth on a wide range of topics, mostly centering on the economy and the role and future of technology in the United States.

In a recent 21-hour tweet storm, Shervin Pishevar described some of the effects that he believes rising interest rates will have on the equity and other markets.

Rising interest rates will mark a new era

One of the things that Pishevar has hit on is the fact that he believes that rising interest rates will usher in a fundamentally new era in all asset classes. He says that this may ultimately be a good thing, provided that the Federal Reserve is willing to completely butt out of the market and not take a heavy-handed approach to open market operations. But Pishevar warns that the short-term results of this reset will likely be painful for many investors. Although, such conditions are likely to result in many rich buying opportunities.

One of the problems that Pishevar sees is that continual interest rate hikes after such a prolonged period of virtually free money is going to send markets into a highly volatile period. He says that there is likely to be a serious correction and that some of the metrics that professionals use to judge the health of markets are likely to depart sharply from their historic norms. The 200-day moving average is just one of the measures that Pishevar says could end up seeing serious departures from its normal ranges as the market readjusts to the shock of dealing with more historically normal interest rates.

https://www.huffingtonpost.com/author/shervin-pishevar

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