Fear at the Top – Trading the Week the Fed Speaks
Weekly game plan for Oct 27–31
Markets keep punching higher while sentiment sits in fear. We didn’t get caught chasing — we planned for this move and traded it accordingly. Now we head into one of the heaviest weeks of the quarter with the Fed, GDP, and mega-cap earnings all stacked into four days. The plan is simple: stay ready, trade what’s in front of you, and let the data decide.
SENTIMENT SNAPSHOT
The CNN Fear & Greed Index closed at 33 (Fear) on Oct 24.
That’s up slightly from 29 last week but still well below the neutral line. Positioning remains defensive, which gives disciplined traders opportunity while others hesitate.
The VIX continues to hold elevated but not extreme. Put/Call (0.86) and Equity Put/Call (0.52) reflect cautious optimism - nervous but engaged. The crowd is not greedy yet, which is healthy.
MARKET SNAPSHOT
The SPY daily chart shows a steady climb from mid-October lows with a rising 4-hour ADX confirming trend strength.
QQQ is just under resistance (621-624) but momentum remains positive.
IWM lags yet holds above its 50-day MA — a constructive setup if risk appetite expands.
Stay patient around these zones. A clean breakout and retest is the trigger. Failure at resistance or loss of support means fade the move and protect gains.
MACRO DATA THIS WEEK
MON 10/27 – Durable Goods Orders (Sep)
TUE 10/28 – Case-Shiller Home Price Index (Aug), Consumer Confidence (Oct), Richmond Fed (Oct)
WED 10/29 – FOMC Rate Decision 2:00 PM ET, Press Conference 2:30 PM
THU 10/30 – Q3 GDP (Advance Estimate)
FRI 10/31 – Personal Income & Outlays (Sep) with PCE Price Index, Chicago PMI (Oct), Michigan Sentiment (Final)
No Fed speakers this week due to the blackout window. Expect quiet tape early and fireworks mid-week.
FED & RATES
FOMC meets Oct 28-29. Futures price a 99 % probability of a 25 bp cut, target range 4.75-5.00 %.
The 10-year Treasury yields ~4.0 %, the 2-year ~3.48 %, keeping the curve inverted but easing.
A less-hawkish tone could extend the risk rally; a “wait and see” message may stall momentum short term.
CROSS-ASSET VIEW
$DXY 98.9 – Dollar stable heading into FOMC
WTI $61.50 – Holding low 60s as supply remains ample
Gold $4120 – Inflows remain strong as a policy hedge
Bitcoin $110600 – Uncorrelated and holding above 110 k handle
Nothing here screams panic or exuberance - steady cross asset tone supports equities for now.
EARNINGS ON DECK
This is the heaviest week of the quarter.
Wed (After Close) – $MSFT, $META
Thu (After Close) – $AAPL, $AMZN
Also reporting: $GOOG, $V, $MA, $UPS, $PYPL, $BA, $CAT, $MRK, $CVS, $XOM, $CVX, $ABBV, $LIN
Expect volume spikes and headline whipsaws around each print. Avoid naked premium directly into the reports unless sized very small.
TRADE POLICY UPDATE
Tariffs returned to center stage.
The USTR expanded the China tariff list to 407 product categories under Section 301.
President Trump threatened a 100 % tariff on all Chinese imports starting Nov 1 if talks fail.
China warned of retaliation, and the EU is reviewing Beijing’s proposals to avoid EV tariffs.
Headline risk is elevated. If tariffs stick, expect pressure on semis, industrials, and global beta. If walked back, which sounds like there is a framework to be agreed upon with President Trump and Xi then watch for a relief rally in those names.
SEASONAL FLOWS
Month end lands Friday. Expect the usual rebalance flows late week which can distort the final hour.
Historically November is positive for equities but the setup is front-loaded with risk events first.
GAME PLAN
1️⃣ Stay ready. We’re trading into the FOMC and earnings cluster. Expect two-sided volatility.
2️⃣ Trade what’s in front of you. Let price confirm before adding risk.
3️⃣ Keep risk tight. If you don’t like the setup, the best trade is no trade.
4️⃣ Protect profits. Month-end flows can erase a good week in the final hour.
For premium sellers – IV should stay supported through Wed. Target 0.15-0.25 delta entries on names that have already reported. Manage winners fast.
For directional trades – use listed levels and respect the first move after FOMC. Do not fight momentum.
SUMMARY
We’re in a fearful market sitting at record prices with the Fed, GDP, PCE, and mega-cap earnings stacked in four days. The setup is clear - volatility and opportunity go hand in hand. Have a plan, trade the reaction, and keep capital intact.