FX Evolution

Equities often perform well when the Fed begins cutting rates, but caution is warranted if economic growth is weak—it could lead to a different outcome. 😱

As we've emphasized for months, markets tend to enter these periods with some weakness, but a significant structural shift usually follows the rate cut. The pace of the cuts also matters—25bps might indicate a steady slowdown in economic activity, while 50bps could signal more of a panic, similar to what we saw in 2001 and 2007.

Remember, FOLLOW THE STRUCTURE, NOT YOUR GUT!

Source: Goldman Sachs

And So It Begins Again:

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Whats your price Target now?🤑 $TSLA

What happens when we eventually do get a rate cut from the FED?

Well that depends on the market conditions.

Be on the lookout for how Semiconductors perform if we do start to see cuts in the future.

That remains the most important market.