First, let's talk about the Federal Reserve's interest rate decision in the early morning, which left a rather bland impression on me personally, the biggest feeling being quite boring.
Firstly, this time the voting committee unanimously decided to cut rates by 25 basis points, and the wording of the statement has also become more gentle: no longer emphasizing greater confidence in inflation, but rather stating progress has been made; the slowdown in job growth was also changed to a general easing in the market.
It is evident that the Federal Reserve is also thinking: the non-farm payrolls in September were impressive, but the unemployment rate did not continue to rise, and the CPI for October slightly exceeded expectations, so they dared not be too aggressive in their tone.
Powell's press conference was basically uneventful, still that same approach of watching the data and taking steps accordingly. It basically boils down to, if the economy is good, then cut slowly, if the economy is bad, then cut quickly. Hmm, the classic "flexible response".
The most eye-catching moment was when someone asked Powell: "What would you do if Trump asked you to resign?" Old Powell decisively stated: "No way, the law doesn’t allow the president to fire me!" This response was quite on point; the Federal Reserve chair must have an independent stance, which serves to uphold the credibility of the Fed as well.
That said, if Trump really comes back into power, it’s likely that there will be unavoidable games between the two, after all, Trump is known for being a rate-cutting enthusiast.
As for whether rates will be cut again in December, which is what everyone is most concerned about? Powell was more cautious this time in his outlook, estimating that unless there’s an unexpected situation, as long as inflation rebounds significantly, there should still be a small cut in December. Although if Trump comes back and implements stimulus policies, it may bring some inflation expectations, but in the short term, the impact will not be large, and the path of rate cuts is likely to continue.
Back to the market, Bitcoin has been reaching new highs while simultaneously witnessing a massive short squeeze these past few days. After all this turmoil, Bitcoin might need to take a break, giving Ethereum a chance to shine.
On the other hand, ETH/BTC has started to take a strong route, with funds flowing from Bitcoin to Ethereum for two consecutive days, giving it a somewhat trending feel. Moreover, Ethereum's ETF has seen a net inflow of over 50 million USD for two consecutive days, reaching a recent high, indicating a bullish market.
In the early morning, Bitcoin surged due to the Fed's rate cut, hitting a high of 76,850 before a slight pullback; the NASDAQ, S&P 500, and Dow Jones also reached new highs, but the Dow painted a "dark star", hinting at some divergence.
The dollar index has declined, and gold has rebounded. Although this rate cut is favorable, the expectations for future rate cuts have weakened, so this wave is sweet in the short term, but in the medium term, it may gradually flatten out or even change face.
