A finance YouTuber whom I have religiously followed since 2021 has given her bold prediction about the possible market movement after FOMC meeting next week (18 Sept 24).
She mentioned that if the Fed cut interest rate by 50 basis points (bps), the market will go into euphoria and rocket into a new All Time High over the next 1 month plus. She advised investors to avoid shorting the market and to go heavy on their bullish strategies.
However, if the rate cut is only 25 bps, then investors should be prepared for the next round of correction as the market sentiments will revolve around recessionary fears and the uncertainty of the US presidential elections, on top of the disappointment of a lower rate cut. The S&P is likely to correct to 5200 by November, before rebounding again. Therefore, investors should reduce their holdings and exit their long positions for the time being.
Watch the clip here:
https://www.youtube.com/clip/Ugkx5XEIRn49fyjv96zt4jAIseqfTxKQgZ0r
Full video:
https://www.youtube.com/clip/Ugkx5XEIRn49fyjv96zt4jAIseqfTxKQgZ0r
Concluding Thoughts
I will be watching the FOMC meeting reaction closely and if the market starts to sell off in reaction to a lower hike, I may sell off some shares that are profitable already to lock in the profits.
However, I do hope the other outcome will come true as that would mean that my excess liquidity would improve significantly if the market goes on to reach a new ATH, and that my positions in Nvidia Bull CALL Spread would reap good rewards for me.
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