Going into an FOMC meeting, a constellation of factors come together to affect the event’s price outcome

This is a segment from the Forward Guidance newsletter. To read full editions, <a href="https://blockworks.co/newsletter/forwardguidance" rel="nofollow">subscribe</a>.<hr>So the Fed cut rates by 25bps yesterday and markets threw a fit. Hell, we even ran <a href="https://blockworks.co/news/rate-decision-fuels-santa-rally-odds" rel="nofollow">a headline</a> talking about a Santa rally that was about to ensue. Whoops. It happens. But what gives? What actually happened? Let’s break it down.Going into an FOMC meeting, a constellation of factors come together to create the tension that leads to the price outcome of the event. This combination of the market’s expectations is based on the FOMC’s forward guidance (the name of this newsletter!) and the positioning of market players going into the event with respect to those expectations. Let’s break the two down. <h2>Expectations</h2>Going into the meeting, the SOFR curve, which can be considered the market implied forecast of the fed funds rate path toward its terminal rate, had departed significantly from the Fed’s previous summary of economic projections forecast from September.<figure><img alt="" src="https://static.fwimg.io/img/feed/d57ffeb2db236e19dc1d8cc272eab091.jpg"></figure>This largely reflected a major phase shift upward in economic strength and resilience of the labor market, requiring less rate cuts than what everyone expected in September. In 2025, the market was only anticipating three-ish rate cuts. Therefore, to surprise the market to the hawkish side of things, the hurdle was very high to achieve this. To my surprise, the FOMC managed to do it while also cutting rates yesterday. A hawkish cut? What a time to be alive. By moving up the expected fed funds rate to 3.9% (from 3.4%), the FOMC forecasted only two cuts in 2025 vs. the already hawkishly positioned market that expected three.<figure><img alt="" src="https://static.fwimg.io/img/feed/0d1a9b6ec04149b36cc9133a77a3b228.jpg"></figure>This decrease in the amount of cuts was largely driven by increased uncertainty on the path of inflation in the next 12 months, as seen here:<figure><img alt="" src="https://static.fwimg.io/img/feed/139cb72472177113b3ada1bb3fcdd528.jpg"></figure>All of that information got distilled into this simple move — the second dot here moving above the market’s expectation in 2025: <figure><img alt="" src="https://static.fwimg.io/img/feed/c574dd7069c2d0d5e4b853eb319905be.jpg"></figure>Now what made this move so brutal yesterday? The second part: positioning. <h2>Positioning</h2>There’s a trifecta of positioning dynamics that came together to lead to the perfect kindling, sparking the fire that was yesterday. As Tyler Neville (co-host of the roundup) discusses here, with the VIX being so low into the event, the systematic crowd was aggressively long: <img src="https://static.fwimg.io/img/feed/870e12e4391cc6abcb3ef4e9f8f80481.jpg">Further, there were widespread expectations of seasonality dynamics in markets (i.e. the Santa rally we alluded to yesterday) to take us to the promised land. This led to everyone piling in on the same trade of longing high beta risk assets under an assumption of continued dovishness from Powell.Finally, we have the largest options expiry in history happening this week. With such large open interest, dealers who have to hedge their delta exposure end up chasing gamma in a reflexive manner that amplifies moves in markets. This further led to yesterday’s acceleration.As always, there’s no single cause for market moves on any day. More so, it’s the constellation of a variety of factors that come together to cause the outcome. And some days those end up being quite aggressive moves, like we saw yesterday.<hr>Start your day with top crypto insights from David Canellis and Katherine Ross. <a href="https://blockworks.co/newsletter/empire" rel="nofollow">Subscribe to the Empire newsletter</a>.Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. <a href="https://blockworks.co/newsletter/onthemargin" rel="nofollow">Subscribe to the Forward Guidance newsletter</a>.Get alpha directly in your inbox with the <a href="https://blockworks.co/newsletter/research" rel="nofollow">0xResearch newsletter</a> — market highlights, charts, degen trade ideas, governance updates, and more.The Lightspeed newsletter is all things Solana, in your inbox, every day. <a href="https://blockworks.co/newsletter/lightspeed" rel="nofollow">Subscribe to daily Solana news</a> from Jack Kubinec and Jeff Albus.

Unpacking the Santa rally that never was

연방공개시장위원회(FOMC) 회의에 들어가면서, <Constellation>의 요인들이 모여 이 행사의 가격 결과에 영향을 미치게 됩니다.

GM(Good Morning) 자동화된 마켓 마이커(AMM) 이더리움(ETH) 에이다(ADA) 폴리곤(Matic) 폴카닷(DOT) 솔라나(SOL) 크립토닷컴 코인(CRO) 후오비 토큰(HT) 미나 프로토콜(MINA) 게이트체인(GT) 옵티미즘(OP) 이더리움 네임서비스(ENS) 알위브(AR) 온톨로지(ONT) 앰프(AMP) 알케미페이(ACH) 플레이댑(PLA) Ronin(RON) 리퀘스트(REQ) 온톨로지가스(ONG) 디젠(Degen) 신고가 솔라나(Solana) 트론(TRON) 다이(Dai) 프롬(Prom) 스텔라(Stella) 렌(Ren) 컨스텔레이션(Constellation) 킨(Kin) 블록 롱 포지션 초당 거래 수(TPS) 인터컨티넨탈 거래소 유동성 공급자(LP)

결코 실현되지 않은 산타 랠리의 풀이

오늘 새벽, 연준은 기준금리를 25bp 인하했습니다. 이 결정은 시장 예상 내에 있었지만, 미국 주식, 금, 암호화폐 시장의 급격한 하락을 초래했습니다. 다우존스 산업평균지수(다우)는 2.58% 하락했고, 10거래일 연속 하락하며 1974년 이래 최장 연속 하락 기록을 세웠습니다. S&P 500 지수는 2.95% 하락했고, 나스닥 지수(나스닥)는 3.56% 폭락했습니다. S&P는 연준 금리 결정일 당일 최대 하락폭을 기록했습니다. 금 가격은 당일 60달러 폭락했습니다.
암호화폐 시장에서는 비트코인이 일시적으로 9만 9천 달러 아래로 떨어졌습니다.

연준의 금리 인하는 시장 충격을 촉발했고 비트코인은 계속해서 99,000달러 아래로 떨어졌습니다.

암호화폐 시장은 지난 24시간 동안 여러 <알트코인>이 1주일 만에 가장 낮은 수준으로 폭락하면서 일련의 <청산>이 발생했습니다. 광범위한 하락의 결과로 상위 3개 트렌드 중 2개가 <라이트코인(LTC)>과 <옵티미즘(OP)>이었습니다.

오늘 이러한 Altcoins가 트렌드인 이유 — 12월 19일

비트코인 가격은 연방준비제도가 25 베이시스 포인트의 금리 인하를 발표한 뒤 <뉴욕 목요일 아침> 10만 달러 아래로의 하락에서 회복되었습니다. <CoinDesk의> 크로미아(CHR) 크리스틴 리가 연방준비제도의 ...