In short... the Fed is not trying to 'lift the market' or 'send it soaring', it is trying to make a soft landing for the economy without letting it fall into a recession.
They want to ease the pressure a bit... but they don't want to completely let the market go.
Why does the cut not mean a rescue for the market?
The Fed itself raised growth expectations...
It seems that companies can continue and achieve good profits.
But at the same time, even with the interest rate cut, it is still high and this makes:
Borrowing is expensive
Debt is expensive
Companies have to pay attention to every step
So the market has not entered a massive recovery wave... it is still moving quietly and cautiously.
Where is the problem now?
We have entered a stage called "Fragile Balance"...
Any news, any employment data, any hint from the Fed... could cause a strong fluctuation in the market.
Not because the situation is bad
but because all the investors are waiting to see:
Is the cut that happened the beginning of a series of cuts?
Or is this just one cut and that's it?
🎯 What do we understand from this?
✔ The cut is positive... but it doesn't mean immediate rise.
✔ The market will continue to fluctuate between news.
✔ What controls the real direction is the upcoming employment and inflation data.
✔ And the whales usually move before we see the clear signal on the chart.
In short, what do we understand? 😉🔴
The Fed cut the interest rate... but not to support the market,
He is trying to ease the pressure on the economy little by little without a big drop happening.
At this stage, the market is sensitive to any news... so don't think any rise or fall is a new trend.
