October 29, 2025 Fed Wednesday
Today is a Fed Wednesday and it is expected that the Fed will cut rates, but this time it is due to a cooling economy with inflation. The last Rate Cut in September caused a rally, but it was an extremely volatile period from the 2 p.m. decision, through his speech at 2:30 to 3p.m., and into the next day, so we always keep that in mind. Price in many sectors shot up, then sold off, then shot up again, then sold off again into the close, so we expect that volatility. In this report, we are just going to discuss where we are now timing-wise, and what might happen.
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THE SPX is on day 12 and that makes this tough, because it has already bullishly gapped up 3 times heading into the Fed Day. The hard part is that this can run higher into day 20-30 really, or it can fill those gaps…
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ONE IDEA: So I have drawn here a gap fill (or gaps) dip to the 20ema, especially if the speech mentions a slowing economy and it is viewed as bad. A rally could follow, because it is still a buy the dip bull run.
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Or an a-b-c down into an ICL. We sell off, they buy the dip, and then it rolls over, BECAUSE AN ICL is due. We are entering month #7.
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What about that parabolic move possibility?
NASDAQ: This is still a possibility and think about what happened with Silver. It took off higher in the 4th daily cycle and started to run in a similar manner to Gold, looking parabolic. Could the markets do that with a rate cut? They could and they could leave these gaps behind as breakaway gaps.
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THE USD is sitting on the 20 ema and above the 50sma after bouncing off of it. The last rate cut sent it higher and that was our last low, so a rate cut today might send the USD higher to a new ‘higher high’. That last USD rally out of the rate cut fed day did not hurt Gold, Gold rallied too.
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We have interesting set ups in the precious metals sector. Why? The General Markets gapped up again and again as we approached the Fed, Precious Metals sold off. That sell off was much needed to cool sentiment and was it enough? It actually could be. I will start with 2 reminder charts and then a few more for Gold..
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#1 Reminder for GOLD – Yesterday I said, “Let me show you something interesting.”
Do you remember what Gold did on September 17th, with the last rate cut? It closed red and was also red on Thursday, and that became an extremely mild dcl. It showed up more clearly with Silver & GDX. It then rallied up to day 22 after that, so…
#2 reminder for Gold:
We now have a rally out of that rate cut, a peak on day 22, and a pullback heading into the next Fed Mtg. Gold is on day 27 – and that is within the time when a dcl can form. Will Gold drop to the 50sma? It might, since it was actually red a day after the last fed mtg and it is not oversold, so we’ll see. At This Point, we have the lowest day on day 27 as we head into the Fed Wednesday.
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GOLD DAY 28 – I added the 34 sma, since that is also a common support at times. Gold dropped on day 28 and recovered. WAS THAT ENOUGH? It could be, since we have an a-b-c drop in a bull market, and…
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1. GOLD reached oversold,
2. Gold bounced at the 38% Fib number
3. Gold has an a-b-c down in place at day 28, BUT….it CAN also drop further to that 50sm, so it’s tricky.
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SILVER also has an a-b-c dip. On a Fed day, it could drop to the 50sma, when we remember that at the Sept 17 rate cut, Gold and silver both dropped the next day, and THEN they rallied. See the Fed day on this chart.
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SILVER is on day 29 or day 30 today if it moves lower.
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SILVER also dropped roughly 50% from the rally low in July to the highs in October. It dropped a lot faster than it ran higher, taking 50% of that 2.5 month rally back in just 2 weeks. That is what often changes sentiment.
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GDX dropped quickly too.
Think about this: GDX lost 50% of a 3 month rally in just 4 red days.
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GDX – So we have an a-b-c down and price lost the 50sma. It may just be a shake out if the Miners can rally out of the rate cut situation. If the Fed mentioned a rate cut despite inflation, the ‘inflation’ part could spark the Miners.
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REMINDER:
GDX closed red on Fed Wednesday September 17th and dropped on Thursday too, but put in a reversal. It then rallied after that, so whatever happens today-that may NOT be the real direction that we see in the coming weeks.
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GDX has pulled back, and it could sling shot higher again, to finish up a blow off top move that we have discussed.
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GDX – I also discussed what the Nasdaq did after it ‘peaked’. It ran back toward the highs, formed as L.T., and then began to chop lower, so we’ll keep that in the back of our minds too. This move looks parabolic, so we just need to see if it is finished / peaked? or one more run?
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YESTERDAY I POINTED THIS OUT:
SILJ bounced at the 50sma. Yes, this is as of now and it COULD break down further, but it is worth noting because while EGO, KGC, HMY, AU, AEM, etc are now under the 50sma…
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SILJ -reversed at that 50sma. Very interesting so far.
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What else can I say? It’s a Fed Day! Stay Frosty my friends!
Fed day is ALWAYS volatile after 2 p.m., during his speech, and then into the close. I have also pointed out false moves in Precious Metals in September, when they dropped into Thursday and then rallied, so we can get a lot of false moves on a day like today.
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~ALEX
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YESTERDAY:
BITCOIN is getting tricky on day 57. The cycle count calls for a drop to a new low around day 60, but it looks bullish with a day 46 low (that really seems much too early for a low) and stocks like CIFR, IREN, DGXX, HUT, RIOT, etc are bullish looking too. At This Point, it looks like this should drop quickly to a new low and then rally, so I have to go with that.
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BITCOIN is on day 58 for the Fed Day. I have to expect a low , because the day 46 low is just too early from past cycle counts. I must admit that it doesn’t really look like we’ll get that pullback, but do you see where I marked day 17? That is also the point where the last rate cut / fed day came in. Bitcoin basically sold off for 7 days after the Fed rate cut. We’ll see, but I am out of all crypto stocks because I have to expect this pullback. I’l try to find a way back in if Bitcoin rallies above the 50sma.
