Rate Cuts Coming Up?Simply put, yes , the Fed has appeared to switch its position on the FRED:FEDFUNDS remaining flat and are expecting further rate cuts. So what can we hypothesize the market's reaction will be? Well, you guessed it, the market will probably like the news and cash will flow into "risk-on" assets including crypto assets and, of course, stocks. Furthermore, we can infer that the market is not currently pricing in any rate cuts and we have yet to see a TRUE correction specifically in the TVC:DJI , TVC:NDQ , and the $SP:SPX.
The image above shows an example of the 200 EMA significance and how it can be used to buy the dip at the right timing. PLEASE do not try to buy each top and bottom as it's virtually impossible to perfectly time the market. However, it should be suggested that you buy the day after the underlying bounces off the EMA. This is the most effective way to avoid a "fake out" in the trend. When this EMA it touched and rebounded, it could imply that a correction has taken place and that momentary downtrend is about to reverse to continue its previous bull trend. This could look as shown below.
Just because it is shown on the chart doesn't make it so. Please keep in mind an equal and opposite possibility, where the EMA is broken through and a Bear market begins. Even though the odds for this are less than likely, the market simply not getting a rate cut could lead to this situation becoming a reality. In this market, nothing is impossible so be ready for everything.
In conclusion, prepare for rate cut from not only the Fed, but ECB, and Bank of England as well. With this, we can expect rising markets as cash moves its way into risk assets. However, no one is a visionary, so if the markets don't get what they want (and we all know that it wants rate cuts more than anything), expect a lowering market and prepare to exit positions until a rebound appears reasonable.