September 18, 2024 Fed Watch - Rate Cut During Trading Hours
with Dale Wheatley 1:30 - 4:00pm Eastern
September 2023: Pause in Rate Hikes
Another notable instance occurred in September 2023, when the Federal Reserve decided to pause its rate hikes despite earlier indications of a more aggressive stance.
This surprise move was justified by emerging signs of economic slowdown and softer inflation data.
Markets responded with a strong rally; the S&P 500 surged by 2.7%, marking one of its best single-day performances of the year.
March 2023: Interest Rate Hike
In March 2023, the Federal Reserve raised interest rates by 0.25%, marking a continuation of its tightening cycle aimed at curbing inflation.
The announcement came against the backdrop of persistent inflationary pressures and a robust labor market.
The immediate market reaction was pronounced: the S&P 500 dropped by 1.5% on the day of the announcement as investors recalibrated their expectations for corporate earnings and economic growth.
January 2024: Quantitative Easing Resumption
In January 2024, the Federal Reserve announced the resumption of quantitative easing (QE) measures, committing to purchasing $500 billion in government securities over the next six months.
This unexpected move was aimed at providing additional liquidity to the financial system and supporting economic growth. The market reaction was immediate.
The S&P 500 jumped by 3.5% on the day of the announcement, while the Dow Jones Industrial Average and NASDAQ Composite rose by 3.2% and 4.1%, respectively.
May 2024: Hawkish Stance Despite Slowing Growth
In May 2024, the Federal Reserve's decision to maintain a hawkish stance despite evidence of slowing economic growth led to significant market turbulence.
The Fed signaled its intention to continue with rate hikes to combat still-elevated inflation, surprising many who had expected a more dovish approach.
The S&P 500 dropped by 2.8% following the announcement.
In The January 31, 2024 Fed recap: Powell shoots down March rate cut
We saw the market reaction coming.
VXX 5 minute chart at 2.45pm Eastern
The VXX had a clear upside divergence at 2:45pm EDT that led to every major market selloff!
SPY 5 minute chart at 2.45pm Eastern
Clearly as the SPY pushed higher the MACD was flat indicating a potential move down and confirming what we saw in the VXX.
SPY 485 Puts 10c to $2
Brilliant, Absolutely incredible!!!
Returns on IWM puts did the best but even the SPY did well. Here's the SPY 485 puts that expired January 31, 2024.
Join Dale and a group of motivated traders on Fed Watch September 18, 2024
We'll look for opportunities to leverage the Fed comments
While there's no guarantee we'll see the setups that we know yield the best returns, this is an opportunity to join the master divergent trader, Dale Wheatley for what may be a pivotal day.
Special Offer September 18, 2024 1:30 - 4:00 pm Eastern Live Market Zoom Meet with Dale Wheatley on Fed Watch.
Only $149 $97
