PANews Report: Fed Cuts Rates, Market Optimism Rises, Volatility Expected

September 19th, 2023 - QCP Capital's latest report highlights the Federal Reserve's 50 basis point rate cut announcement last night, coupled with plans for two additional rate cuts this year and four in 2025. While Chair Powell remained ambiguous about the future scale and speed of rate cuts, all eyes are on upcoming labor data for insights. The US 2-year/10-year treasury yield curve, a recession indicator, has been inverted since July 2022, but recently rose to +8bps, reflecting market optimism and rising risk appetite. The S&P 500 attempted to hit a new high but closed lower following the FOMC meeting.

Options Market: Implied volatility dropped significantly after the FOMC meeting, with BTC down 19 points and ETH down 18 points.

Price Action: Following the FOMC, BTC rallied from $59,000 to $62,000 while ETH traded near $2,400.

Looking Ahead: Volatility is expected to surge as the election approaches, coinciding with the next FOMC meeting.