Thoughts on the market post FOMC

At the start of next year, I will be increasing my subscription price from $35/month or $350/year to $39/month or $390/year. Current subscribers to the monthly or annual plan will not be affected as the current lower price will be available when you renew.

Powell delivered mostly what the market expected - a “hawkish” cut with one more cut in the 2026 dot plot and mostly non-committal language about the timing of the next cut. I put “hawkish” in quotation marks because yields had already gone a long way to price in this outcome. The number of dissents wasn’t as high as the market feared, which is why the initial reaction for equities and bonds was to rally.

SPX is already looking past the FOMC by reacting to some disappointing Oracle earnings and breaking previous support at 6830 in the Dec futures. Often, the market reveals how it’s positioned or what its true intent is after a major event (such as the FOMC or CPI) passes, and I suspect that today’s selloff during the Asia session is an example of that. Many questions remain unanswered about the sustainability of the AI capex boom, while the bottom section of the K-shaped economy is still struggling from weak labour, tariffs, and above-neutral interest rates. Despite the lack of compelling positive catalysts, the market feels like it is consensus long and bullish going into 2026.

There has been some technical damage done on to the SPX and BTC charts, which I’ll highlight below. I’m inclined to trade both from the short side from here.

ES 4 hour chart - a bad high at 6908 then an outside reversal. 6800 must hold.

BTC daily chart. This looks more like a continuation pattern to me, not a bottom. 94600 was a bad high.

The following section covers my portfolio positions and how I plan to risk manage them in this potentially bearish scenario.