WOW! What the Fed JUST Said.

well there we have it the Federal

Reserve catalyst is out of the way and I

have to say some things went as expected

some things did not go as expected here

first of all we know we are coming off

of good earnings for AMD and Microsoft

fantastic earnings here and Nvidia is

benefiting way more than AMD or

Microsoft are benefiting but what did

the Federal Reserve just say well the

FED told us the time has come now that's

the time for rate Cuts now this this is

mindblowing to me that they actually

teed this up they totally teed up the

September rate cut I was not expecting

that I was expecting a neutral to

positive or neutral to doish Fed we got

dovish and positive and teed up rate cut

baby now let's explain how they teed

this up is it was pretty remarkable

first they started with the statement

the statement started off pretty obvious

that we were about to have a fed because

they were completely removed the idea

that they were going to be highly

attentive to inflation risks and we were

really surprised when we saw this

instead they moved to this sort of 5050

aspect where they're attentive to both

sides of the Dual mandate which

basically implies they're equally

balanced between yeah uh we're bullish

uh on jobs and bullish on inflation

they've equally balanced this now now of

course they're not going to declare

Victory but wow what did they tell us in

the meeting they told us that uh

inflation here we go uh inflation has

eased substantially we're attentive to

both sides we've got good growth

2.6% investment in equipment has picked

back up inflation has eased notably and

we've made considerable progress on

inflation this was mentioned maybe three

or four times so really trying to show

that they wanted to bring this idea that

they're so heavily focused on inflation

down into balance and later the meeting

he even said we're pretty much balanced

now between the two uh we're moving

closer to where it will be appropriate

to reduce policy rates he went to even

more detail later rates rate Cuts could

be on the table as soon as the next

meeting and we are getting closer to the

point of where we can reduce rates he

says if we get a disappointing reading

obviously that could weigh against a

September meeting cut we want more good

data we've seen progress what I'm

basically Gathering From This is as long

as you have an acceptable jobs report

and an acceptable CPI report they will

clearly signal by Jackson Hole the third

week of October that yes the rate cut

for September is in the bag the progress

is equal now keep in mind when I get

through this summary I'm also going to

go through my thoughts on the market and

trades and things like that so we'll

cover that just want to get through some

of what jpow just said uh and then of

course remember today is coupon

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is almost full for October all right uh

we last raised rates a year ago in the

July meeting today we're in a completely

different economy he says we've made a

lot of progress we've made progress on

all three forms of inflation all three

core forms of inflation uh Goods

non-housing services and Housing

Services we can afford to begin

adjusting rates the upside risk to

inflation has decreased the time is

coming at which it is beginning to

become appropriate to cut back those

restrictions uh headline number uh on on

jobs have come down and the majority

supported not moving today now this is

really interesting because it somewhat

implies that some were for actually

cutting today or maybe hiking but I I

out hiking it was probably someone was

like oh why don't we cut today and

every's like h no let's consensus cut in

September he says we're starting to see

the lags start showing up the lagging

effects of higher rates on the economy

start showing up he says that uh the

labor market has seen a normalization

was asked about the PM rule we actually

specifically thought that he would get

asked about it we wrote this on our fed

Bingo someone asked about the S rule

trigger literally got asked about it but

I'll tell you look at how I lost Bingo

here I had two chances at bingo I had a

shot at bingo across the board right

here on the second row this was a shot

at Bingo and this was a shot at Bingo

but I literally lost bingo in two ways

because Nick T did not sit next to the

New York Times Blondie I'm like what the

hell like seriously he always sits next

to jennif from The New York Times this

is the first time in years Nick T had a

different woman between him and her what

is this this is crazy anyway so that was

a little bit of a disappointment because

I would have had double Bingo but anyway

drum pal suggests this situation is

unique no decision made yet on whether

we'll do a 25 BP cut or 50 that we are

consens consensus driven as soon as the

next meeting uh oh uh he was

asked uh would you consider cutting as

soon as the next meeting uh is there a

growing consensus and he said yes there

is a growing consensus the time is

rapidly approaching to cut as long as

the data doesn't show a sharp weakening

so uh in my opinion now here's how

trades get played and this is tough okay

this is this is tough to play so I want

to make this crystal

clear so we're going to set this up on

screen here this is my take for the

trades okay so last week we said uh

whatever earnings are they drive the

market this week fed will introduce uh V

but that's it maybe short-term trade but

earnings will prevail so what do we

seeing well we saw markets rally after

uh AMD and Microsoft yesterday uh what

do we expect

today uh markets right now are trading

down going into the close why my my

opinion markets are waiting for qcom

meta and arm and then tomorrow we get

apple and Amazon tomorrow so in other

words true

bullishness may not fully unlock until

we clear all of these earnings so a lot

of people are saying Kevin in your

opinion not Financial advice when is it

time to buy the dip when dip buy I think

there's an argument to say you dip by

potentially each of the good earnings

right maybe each good earnings set so a

little today uh based on AMD msft a

little Tomorrow based on arm qcom meta

today if the earnings are good and then

a little Thursday uh SL Friday based on

Apple Amazon if the earnings are good

right now we remember what I've said

last since last week I said uh if

earnings bad recession if earnings good

uh flip bullish right and then I also

said fed will just add fuel to the fire

uh of whatever earnings are I maintain

this belief now so far we are trending

in the bullish Direction so I think the

markets as long as we continue to get

good earnings will TR bullish in through

the week everything iwm the q's chips

interest rate sensitives I don't really

care what it is I think it all goes up

into Friday as long as arm cuom meta

Amazon and apple don't get reamed if

they get reamed you got big problems so

that's my take so uh that's why I think

if you're looking for sort of longer

term dip buys maybe every time you get

good earnings you dip Buy

another option uh is uh you know other

option wait until earnings are done uh

and then another thing you could do if

you want less volatility so for Less uh

less V in a trading portfolio I'd

probably go go at least next Friday

unless you have Diamond uh balls or you

know uh some some like uh uh you know

death wish or whatever uh not saying I

don't I do crazy things sometimes but

anyway uh

probably a good idea because there will

be volatility and really that volatility

is going to be based off of earnings now

uh markets were really tenuous going

into the FED meeting today uh I think

that's because markets are like are you

know what if we get rugged what if we

get rugged didn't expect a rug didn't

get rugged but I also didn't expect them

to tee up the September rate cut the way

they did and frankly they fully gave us

a Fed they fully gave us a an all clear

for a Fed rate cut uh in um uh in

September so now I'm going to take a

brief look just to see at where yields

sit right now and the odds of a

September rate cut September yeah

September rate cut odds just jumped

we're now at

1.16 after the F or at the beginning of

JAL talking we were only at about 1.04

rate Cuts uh that's now jumped to

1.16 we're now at uh almost price pring

in two full rate cuts by uh November and

almost pricing in three full by uh

December and then 3 and a half for

January so we'll see where markets go

but uh I think there's going to be a lot

of tenuousness on these earnings if we

could get these earnings out of the

way finally finally we could have the

all clear and we could get rid of all

Hedges it's my take uh still got some

Hedges and uh as we continue continue to

get good earnings I'm going to roll off

those Hedges so let's see what happens

anyway if you want to know exactly what

I'm doing make sure you're part of this

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can't guarantee you'll make money but

always guarantee to provide you the best

perspective that I possibly can give uh

and folks today is coupon expiration day

that does mean the price goes up at the

end of the day today 11:59 p.m. today

you got questions email us at staff ATM

kevin.com Jeffrey golock gunlock says a

lot of room for the FED to cut

short-term rates in an interview on CBC

yeah okay oh yeah he's he's yapping

right now on CBC anyway uh we're going

to be jumping over to the market closing

live stream for meta earnings uh within

about 30 minutes we'll see you all soon

thank you so very much for being here

and we'll see you goodbye and good luck

these things that you told us here I

feel like nobody else knows about this

we'll we'll try a little advertising and

see how it goes congratulations man you

have done so much people love you people

look up to you Kevin P there financial

analyst and YouTuber meet Kevin always

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