📖You must read this post carefully, it will help you a lot
Will interest rate cuts definitely lead to rises?
👀85% of people guessed this positive sentiment❗️
⚠️⚠️⚠️Pay attention, the probability of the Federal Reserve cutting rates in December exceeds 85%. Are you waiting for the Federal Reserve to cut rates to save the market? Let me tell you something heart-wrenching, don't wait, these 85% of people have guessed that on the day the positive news lands, it may not only not rise but also fall. How counterintuitive, how exciting? Do you also think that a rate cut equals a rising stock market and soaring cryptocurrency prices? Well, that's the pit that ordinary investors are most likely to fall into. Do you know why the more consistent the expectations, the less the market gives face? Let’s talk about the core logic behind this phenomenon. Simply put, the financial market is all about expectations; machine prices reflect whether the outcome is better or worse than expected. What does the 85% probability mean right now? The 25 basis point rate cut has already been factored into the current land prices and stock prices; when the news lands, the positive sentiment is fully priced in, and there are no new surprises. What kind of reaction can the market have? Let’s take a historical example: in 2019, the Federal Reserve had three rate cuts. The first two times were already anticipated by the market, and after they landed, U.S. stocks and cryptocurrencies fluctuated slightly, as if nothing happened. The third time, because it exceeded expectations, saw a spike. This shows that the key is not whether there is a rate cut, but whether it exceeds expectations. Recently, the correlation between the cryptocurrency market and Nasdaq has dropped to -0.43. What does that mean? When U.S. stocks fall, they fall harder, and when U.S. stocks rise, they respond sluggishly. Are you still hoping for a rebound based on rate cuts? This market always punishes those who follow the crowd and rewards those who understand logic. Do you think this time when the rate cut lands it will rise 📈 or fall 📉?
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