By Bryan Bottarelli, Trade of the Day, 2024-09-16
This week, all eyes are pointed squarely on the Fed…
And for good reason.
On Wednesday afternoon, the Federal Open Market committee will announce their next policy decision.
What we Know: They will cut rates for the first time in 4 years.
What we Don't Know: Going into the rate cut decision – it's a virtual coin-flip scenario as to the magnitude of the cut.
In my view, this 50/50 scenario could sets us up for a big market move in either direction.
You see, no matter if the Fed cuts 25 basis points – or if they cut a larger 50-basis points – that means that half of Wall Street will be upset as to the decision.
You've heard all the bickering before:
They waited too long…
They didn't act decisively enough…
They're behind the curve again…
I'm sure there will be other arguments as well – but the important point is this…
The aftermath of the Fed's decision this week could be the newest rigger catalyst for added volatility in the market.
No matter which side of the argument you are on, the simple fact remains: The Fed is in a no-win situation.
And this alone could prove to be the trigger for a larger than normal directional move.
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