Trade the Fed: October 29, 2025
Rate Cut Already Priced In… But What About the Guidance?
The Federal Reserve will release its latest policy decision on October 29th at 1:30pm ET, and markets are already bracing for a rate cut. But here’s the catch: that move is already priced in. The real volatility trigger for traders won’t be the cut itself — it will be the guidance.
What the Fed Might Be Thinking
The Fed faces a balancing act:
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Deliver the rate cut markets expect to maintain credibility.
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Avoid fueling excessive speculation bubbles.
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Keep optionality for future meetings, since inflation, growth, and employment data remain in flux.Â
 That means the October 29th announcement is less about the action, and more about the tone:
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A hawkish cut would suggest today’s move is insurance, with a possible pause ahead.
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A dovish cut would imply the Fed is preparing to keep easing if conditions warrant.Â
Lessons From History
This isn’t the first time markets have leaned heavily into expectations before a Fed meeting:
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September 2007 – The Fed delivered a rate cut that was widely anticipated, but the more dovish guidance that followed set off a sharp rally in equities.
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December 2018 – The Fed hiked as expected, but Powell’s cautious tone triggered a selloff, showing that guidance can outweigh the headline move.
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July 2019 – The Fed cut rates for the first time in over a decade, but labeled it a “mid-cycle adjustment.” Markets, expecting more, sold off immediately.
The lesson? It’s not the move — it’s the message.
Why Fed Watch Matters for Traders
✅ High-Probability Setups – Fed announcements spark some of the biggest one-day moves of the quarter.
✅ Pattern Recognition in Action – We apply advanced tools like MACD Divergence, Double Tops & Bottoms, and multi-timeframe analysis to spot breakout opportunities.
âś… Real-Time Reaction – Watch UVXY and major ETFs for the first tells of market direction — and potential follow-through trades..Â
Your Edge on Fed Day
Most traders wait and react. We anticipate and position.
By combining volatility analysis with proven technical signals, we look to front-run the market’s response and seize opportunities others miss.
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Here's the setups we look for Â
While there's no guarantee we'll see the setups that we know yield the best returns, this is an opportunity to join the master divergent trader, Dale Wheatley for what may be a pivotal day.
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VXX 5 minute chart at 2.45pm Â
The VXX had a clear upside divergence at 2:45pm EDT that led to every major market selloff!Â
SPY 5 minute chart at 2.45pm Â
The SPY pushed higher, the MACD was flat indicating a potential move down and confirming what we saw in the VXX.
SPY 485 Puts 10c to $2sÂ
Returns on IWM puts did the best but even the SPY did well. Here's the SPY 485 puts that expired January 31, 2024.Â