BY ANDREW GIOVINAZZI
May 7th, 2025
Yo Pit Crazies,
We’re once again witnessing a clash of wills between Fed Chairman Powell and President Trump. Powell remains firm on not cutting rates, while Trump refuses to ease up on tariffs with China—a standoff that’s bad news for the stock market. As for Congress, they are AWOL as usual, despite the ongoing emergency of unchecked federal spending. The Fed continues to avoid commenting on the fiscal situation—but perhaps they should. Now, Trump is resorting to using a sledgehammer approach once more. It might eventually work, but not without causing collateral damage along the way.
Is this FOMC rate release just like the others? In some ways, yes. But where do we go from here?
The action is not on FOMC rate day – it’s 5 days after
I gave a State of the Market class on this topic Wednesday – tune in tomorrow to see what updates I have next. The real action tends to unfold in the days following, as we watch the trend in the SPDR S&P 500 ETF (Ticker: SPY). Since the Fed began actively shifting interest rates in 2022, we’ve typically seen strong moves in SPY—often ranging from 12 to 30 points.
With the VIX hovering around 24, either SPY has to make a move, or the VIX will. That’s the setup I look for in Weekly Profit Cycles. I expect the trend that begins Thursday to hold strong for at least three days.
Bookmark it.
To Your Trading Success,
AG
Andrew Giovinazzi
30-Year Trading Pro
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CAPITOL GAINS: SMR Aug16 7 call closed for a 150% gain
DELTA STRIKE: VLY Mar15 8 puts closed for a 88% gain
PFE May17 26 calls closed for a 66% win
OP MENTORING: SPY Mar22/19 510 put calendars and 520 calls for 6.4% gain
OPTION SHOPPER: ERX Mar28 65 calls closed for a 90% gain