No Rate Cuts, No Problem? Markets Shake Off Weakness

Follow @MrTopStep on Twitter and please share if you find our work valuable!

Our View

If you haven’t noticed, buying the lower opens has been the money trade. I don’t know how many there have been in 2025, but the vast majority have been bought! I’d say that’s a bullish sign, but we all know that tape bombs have been a major issue for the bulls.

It looks to me like the ES is backfilling and consolidating. According to FactSet, the CPI number for January is projected to rise 2.9% year over year (FactSet CPI Report). Will this be a problem for the ES? It should be, but the public doesn’t seem too concerned, or maybe it’s already priced in.

The index markets started the day in the red after President Trump signed off on 25% tariffs on steel and aluminum imports to the U.S. but shook off the weakness, with the S&P cash closing up 0.7% cash close to cash close, its smallest daily advance since November. The YM closed up 0.4%, and the NQ closed down .24% after Fed Chairman Powell told Congress that the economy was doing well and that the central bank would take its time deciding when to cut interest rates.

I’m 100% sure there will be no rate cuts in March or May. The Fed knows it can’t afford to make any more mistakes, and I think rate cuts are off the table for at least the first six months if not longer.