"Classic" Dip and Rally on Jackson Hole — Opportunity Tonight?
The Jackson Hole symposium is an annual meeting for central bankers.
Market is awaiting Powell’s speech at Jackson Hole meeting on Friday.
Since 2022, it has consistently triggered volatility in $S&P 500(.SPX)$ . Typically, the index drops around the event before bouncing back.
Each year it dips, then rebound
2022 Powell went full hawk → S&P dropped -3% in a day
2023 Still tough on inflation → markets slipped
2024 Even with a dovish tone → market still dipped
Unlike the recent market pullback, investors are very optimistic about a rate cut in September.
Although the July CPI report contained some concerning details, overall it was relatively mild, reinforcing traders’ belief that the Fed will lower interest rates in the coming months. Some have even started betting on a large cut, such as a 50-basis-point drop at once.
However, the CME FedWatch tool currently shows an 81% probability of a 25-basis-point cut.
Sector rotation has also returned to the table recently. Over the past week, investors have shifted toward previously overlooked, undervalued sectors that would benefit from lower rates, including residential construction and small-cap stocks, driving strong rebounds in these areas.
If the market drops after Powell’s speech this week, could it be a good buying opportunity?
Will the 2025 scenario repeat? Will the market close lower on Friday?
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This year feels slightly different because sentiment is already leaning toward a rate cut in September. Even though July CPI had some sticky parts, overall inflation looks manageable. With FedWatch showing over 80% odds of a 25-bps cut, I think Powell’s tone may just reinforce what the market is already expecting.
If we do see another drop after Powell’s speech, I’d actually treat it as a buying opportunity. With sector rotation happening, small caps and housing-related names could benefit the most once rates move lower. For me, I’ll be watching closely on Friday to see if the 2025 “Jackson Hole dip” playbook repeats itself.
@Tiger_comments @TigerStars
2022鮑威爾全面鷹派→標普一天下跌-3%
2023年通脹依然嚴峻→市場下滑
2024年即使基調鴿派→市場仍下跌
儘管7月CPI報告包含了一些令人擔憂的細節，但總體而言相對溫和，增強了交易員對美聯儲將在未來幾個月降息的信念。一些人甚至開始押注大幅降息，比如一次性降息50個基點。
If the market drops it is not long term doom. Volatility around Jackson Hole summits is common. Tech and growth stocks may take a hit while defensive stocks, dividend players and value plays may shine brighter.
As Warren Buffett likes to say It is time in the market that counts, not timing the market.
@Tiger_comments @TigerStars @Tiger_SG @CaptainTiger @TigerClub
2025年的情况会不会重演？我觉得概率不小。现在市场普遍押注9月有降息，若鲍威尔言辞偏谨慎，第一反应很可能是下跌。但别忘了，美国经济放缓迹象逐步显现，通胀数据也趋于温和，美联储迟早要转向。这意味着，哪怕周五大盘收低，也未必是坏事，反而可能为中长期投资者提供更好的入场点。
总结来说，我不会在讲话前追高，而是等市场先下探。如果跌幅不大，我会观望；如果出现恐慌式回调，我更倾向于分批加仓，毕竟趋势性的转向才是决定未来一年行情的关键。
However, if the market drops, I do not think it would be a good buying opportunity as many stocks are currently close to fair value or overvalued. I would prefer to just watch and keep my cash for days with bigger dips.
@LuckyPiggie @DiAngel @Universe宇宙 @Fenger1188 @Kaixiang @SPOT_ON @Wayneqq @SR050321 @Success88 @HelenJanet come join
A few good stock is a good DCA opportunity too