Powell Cut Rates, The Market Cut Hope —
I honestly expected the market to rebound after the Fed’s 0.25% rate cut — the setup looked right. Liquidity was improving, sentiment was picking up, and it felt like risk assets were ready to recover. But the rebound never came, and it’s clear why.
Powell’s tone changed everything. The cut landed, but his message made it clear this wasn’t the start of a steady easing path. Traders who had priced in multiple cuts suddenly faced uncertainty. Yields jumped, the dollar strengthened, and overleveraged positions started to unwind across equities and crypto.
Meanwhile, optimism grew after reports of progress in U.S.–China trade discussions, but the details were thin. There was no solid timeline or binding structure — just headlines. Markets trade on evidence, not promises, and that missing clarity kept capital cautious.
So even though both developments looked positive at first glance, they lacked conviction. Liquidity expectations were too high, leverage too heavy, and confidence too fragile. The rebound I was counting on disappeared because the fundamentals didn’t back it.
Right now, markets are balancing hope against uncertainty. Until the Fed signals a defined easing path and trade progress turns into tangible action, any relief rallies will stay short-lived.
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