March 20, 2025

Markets:

Stock futures fell Thursday, one day after the major averages rallied in response to the Federal Reserve sticking to an outlook for two interest rate cuts in 2025.

Tesla, down nearly 20% in March, fell another 1% premarket Thursday. Other tech names like Alphabet also came under pressure, shedding 1%. The Technology Select Sector SPDR Fund (XLK) was down 0.6%.

While the Fed kept a forecast for two rate cuts this year and held the federal funds rate in a range of 4.25% to 4.5% Wednesday, the central bank also raised its inflation outlook and lowered its economic growth projection. Traders largely expect the Fed to not make any moves, however, before officials see the impact of tariffs.

Federal Reserve Chair Jerome Powell labeled the potential effect of tariffs on inflation as likely being short-lived or transitory.

Stocks rebounded Wednesday following the Fed decision, regaining some ground after the past month’s sharp decline. The Dow rose 0.9% and the S&P 500 added just over 1%. The Nasdaq Composite gained 1.4%, but is still down 11% in the past month, firmly in a correction.

The S&P 500, which briefly slipped into correction territory last week, is now more than 7% off its record high.

As White House tariff policies rattled markets earlier this month, President Donald Trump said the economy could see “a period of transition.” A tariff exemption on select Canadian and Mexican imports expires April 2.

Portfolio:

We enter the trading session holding setups in METU and TSLL. True to form we have a different opening price from the price action we received during Powell's speech. If pattern repeats itself, this shakes out and this afternoon / tomorrow the real price activity begins. Wild card, quad witching day tomorrow.

Powell said some extremely interesting things yesterday that are very bullish in our opinion: "We are watching and we have means". That's your backdrop. Understand what he just said.

Queue is igniting and we will be looking to release new opportunities today. Be ready, stay patient.