Fed Day Breakdown: How the Central Bank’s Impending Decision Could Affect Your Trading Strategy

[Image] Fed Day Breakdown: How the Central Bank’s Impending Decision Could Affect Your Trading Strategy Today’s the day, traders! The U.S. Federal Reserve is concluding its December meeting today. They're going to tell everyone what they decide at 2 p.m. EST. And the market thinks it’s likely to keep interest rates where they are. Right now, there's only a 3% chance they'll raise the rates, according to the [CME FedWatch Tool](. But even though this particular meeting may be uneventful when it comes to rate changes, traders should still be keenly tuned in to hear what the Fed might be planning for 2024. Additionally, there’s another big catalyst occurring later in the week that could give us some even juicier trading opportunities (but more on that later)... For now, let’s break down everything you need to know about today’s Fed meeting… What to Listen For in the Fed’s Commentary One of the main things the Fed will share today is its Economic Predictions Summary. The Fed only changes these numbers every two meetings. And this is the first time the central bank is changing its summary since September 20. Last September, they thought the interest rates in December 2024 would be around 5.1%, with inflation at 2.5%. But since then, a lot of new economic data has come out. Most of it is good—inflation is going down, and there's still strong growth and jobs. It'll be interesting to see if the Fed thinks the interest rates and inflation will be lower in December 2024. SPOILER ALERT: I have my doubts (but we’ll get to that soon)... The fed’s tone today will help traders, like you and me, understand what might happen with interest rates. Why should you care? Because changes in interest rates can cause huge price swings in every stock you trade! Right now, people think that short-term rates will be around 4.25% in December 2024, which is much less than the Fed's 5.1% guess in September. This could explain why the market is $5 away from reaching all-time highs—because people think interest rates will be lower in 2024… SPY 3-year daily chart — courtesy of [StocksToTrade.com](   IMPORTANT ANNOUNCEMENT: If you’re still wondering how to trade around this week’s major catalysts, it’s time to listen up… Airing LIVE TODAY, December 13th at 12:45 pm EST… Year-End Stock Market Event - caused by one obscure tax document - will spark a flurry of explosive overnight stock moves to close out 2023. I’m joining Tim Bohen for a LIVE briefing to reveal the details behind what he calls The Final Countdown. A year-end catalyst that dates all the way back to 1925 that has historically caused huge price moves … over and over again. During the LIVE broadcast, I’ll reveal how anyone can use a specific “3 pm countdown window” behind the scenes of the stock market… to target repeatable 15-20% overnight gains to close out 2023… [Click here to RSVP to the real-live briefing now](   CNBC Survey Shows Market Optimism Looking further, a recent CNBC survey shows that traders think the Federal Reserve will start cutting rates next year, but not as fast or as much as people have guessed. The 35 people who answered the survey, like economists and analysts, have differing views on how much and when the Fed will cut rates next year… Outlook forecasts from the CNBC Fed Survey — courtesy of [CNBC.com]( More than 50% of those surveyed think there will be a rate cut by June, going up to 69% by July. On average, they think there will be about 85 basis points (0.85%) of cuts next year, which is less than the 120 basis points (1.2%) people were predicting prior. Market experts are now more hopeful about a 'soft landing' (where the economy slows down but doesn't crash). They give it a 47% chance. They also think there's less chance of a recession happening next year, now at 41%. Still, they expect the unemployment rate to go up to 4.5% next year and the economy to grow just under 1%. This means many still think the economy will slow down. Peter Boockvar, Chief Investment Officer at Bleakley Financial Group, expressed his view, stating, "I still believe [Fed Chair Jerome Powell] is influenced by the economic challenges of the 1970s, leading him to maintain a tighter monetary policy longer than the markets anticipate." What I Think the Fed Will Do There's a lot of talk about if the Fed will lower interest rates. People think the Fed might cut rates three times in early 2024, each time by 0.25%. But I have a feeling the Fed will want to lower those expectations and suggest they won't cut rates as much as people think. If the market gets the impression that the Fed is talking it down, we could see a big flush in stocks. Additionally, the upcoming S&P 500 and Nasdaq 100 rebalancing—happening at the close of trading on Friday—could lead to some major Burn Notice trading opportunities. (Example: I’m trading puts on Docusign Inc. [NASDAQ: DOCU]. For more information, check your email.) Stay on your toes over the next few days. I’ll be back in your inbox tomorrow to talk about what we learned from the Fed meeting. As always… Stay Street Smart, Jeff Zananiri P.S. Time is running out! TODAY, December 13th at 12:45 pm EST, I’m finally revealing an explosive calendar anomaly which could potentially lead you to overnight gains of 23%, 40%, and even 51%! Don’t miss out on "The Final Countdown” … [CLICK HERE TO RESERVE YOUR SPOT NOW!](   66 West Flagler Street STE 900 Miami, Florida 33130 United States [Facebook]( [Twitter]( [Instagram]( [YouTube]( [Click Here to Unsubscribe]( **Our gurus teach skills others have used to make money. Any results displayed are extraordinary and are not typical and will vary from person to person. For more info read our [Earning Claims Disclosure]( About: Making money trading stocks takes time, dedication, and hard work. My goal is to teach you how I have succeeded in the market, but you may not achieve my results. Remember, there are risks involved with investing, including the potential loss of money. We are strongly committed to protecting your privacy and providing a safe & high-quality online experience for all of our visitors. We understand that you care about how the information you provide to us is used and shared. 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