Wall Street starts the week marginally higher, but traders are treading cautiously ahead of the final Federal Reserve meeting of the year. Here’s a breakdown of what’s driving markets:
1️⃣ Fed to Cut Rates, but Caution Ahead
The Fed is expected to announce a 25-basis point rate cut on Wednesday, marking the third consecutive cut. However, the focus is on 2025 rate projections, as the Fed is likely to signal a slower pace of cuts next year.
- Goldman Sachs expects no January rate cut and predicts a terminal rate for the easing cycle of 3.5%–3.75%.
- The Fed’s updated economic projections will show whether policymakers still see three cuts in 2025, down from prior forecasts of four.
- Uncertainty around policies under a second Trump administration and inflation concerns could drive caution.
2️⃣ Futures Edge Higher; Spotlight on MicroStrategy
US stock futures are slightly higher:
- Dow Futures: Flat
- S&P 500 Futures: +0.1%
- Nasdaq 100 Futures: +0.1%
Eyes are on MicroStrategy (MSTR) after its announcement as a new addition to the Nasdaq 100 index, which could draw additional capital to the biggest corporate Bitcoin holder.
3️⃣ Mixed Chinese Data & Stimulus Hopes
Economic data from China shows industrial production steady, but weak consumer spending and falling house prices are headwinds.
- Beijing is expected to introduce more consumer-focused stimulus measures.
- Moody’s raised China’s 2025 GDP forecast to 4.2%, citing stabilization from recent credit and stimulus efforts.
4️⃣ Bitcoin Hits Record High
Bitcoin surged to $106,569, setting a new record high after President-elect Trump suggested creating a strategic Bitcoin reserve, similar to the oil reserve.
- Bitcoin’s market cap now exceeds $2.11 trillion, and just a 14% price increase would make it the 6th largest asset globally, surpassing Google’s market cap.
5️⃣ Oil Prices Retreat
Crude prices fell after weak Chinese economic data and ahead of the Fed meeting:
- WTI Crude: -1.5% to $70.28/barrel
- Brent Crude: -0.7% to $74.00/barrel
Concerns over sluggish Chinese demand and potential oversupply in 2025 are pressuring prices, even as sanctions on Russian and Iranian oil limit supply.
🎯 NQ Update: Key Levels to Watch
Last week, NQ rallied above 21500 to reach a weekly high of 21908, just shy of our 22000 target. This week, the focus shifts to 21700:
- Upside targets: 22000, 22300, 22500
- Downside targets: 21500, 21340, 21000
Notable Economic Data
- Wednesday: FOMC
- Thursday: GDP
- Friday: PCE Price Index, Michigan Consumer Sentiment
Notable Earnings
- Thursday: MU
Will the rally continue, or will the Fed meeting spark a pullback? Stay tuned!
🌟 Don’t Miss This Week’s LIVE Trading Session
Tracks will host a LIVE TRADING session this Thursday for all OP members! As always, Tracks will donate all trading gains to charity during the holiday session. This is a must-watch event for both education and inspiration.
📢 Link will be released tomorrow—stay tuned!
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