Fed 50 Point Fall Out, FedEx, Sell Bitcoin
All the talk this morning is the Fed's 50 point rate cut. I might as well throw in my 2 cents but with a deeper dive.
In the increase cycle, the Fed cautiously and timidly increased rates at 25 points at a time because they were concerned they would rattle markets and the economy. They were behind the 8 ball and are once again. I commented that if they cut 50 points it would be because they were worried about the economy and stock markets would sell off. That's exactly what happened.
The Fed must know the job numbers are bogus to make things look better ahead of the election. Powell himself said there was an argument that job numbers are lower than reported.
However markets and bitcoin are in rally mode early this morning but gold and bonds are not confirming this rally. The TLT 20 year treasury is down again today from it's recent top on Tuesday. The gold price is basically unchanged to up a few bucks.
This stock market rally is a head fake??? Lets see how we progress into next week. I can admit if I am wrong, but not convinced yet. The NASDAQ is still a long way from the July top.
The only market that has made significant new highs is the DOW, but it is a narrow measurement and the recent rallies have not been confirmed by the Dow Transports (DOW Theory). Although Transports may be breaking out today. That said, I would like to see more than just a 'barely' confirmation. Lets see where they end the day and Friday after FedX earnings tonight.
FedEx (NYSE: FDX) is scheduled to report its fiscal Q1 2025 results on Thursday, September 19, after market close. The expectation is the company to post an upbeat quarter, driven by an overall improvement in volumes. Furthermore, its cost reduction actions are expected to bolster its bottom-line growth. Its stock has been in rally mode but appears to have little room for growth from its current levels of around $300.
Many expect FedEx to beat revenue and earnings expectations. FDX could report 0.6% higher Revenue (+$130 Mil) and $0.07 higher EPS in 2025Q1. I see FedEx as a good barometer of the economy because if the economy is doing well FedEx is busy delivering goods.
Sell Bitcoin as it has had 3 strong up days in a row and up around $63,100 which is around the top of the down trend channel. Basically it has rallied with the 50 rate point party. This won't last.
I am suggesting the Bitcoin short ETF (BITI) at about $7.55.
I put this buy alert on Signal with BITI at $7.55. As of this writing it is at $7.45.
Generally I take the average price of about 2 hours or more after my alert goes out as our entry price.
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