The Fed's interest rate meeting in the early hours of next Thursday might not be as optimistic as everyone thinks.

The market is focused on rate cuts, but the real danger is what Powell might say after the meeting. According to the schedule, the rate cut will be announced at 3 a.m., and half an hour later he'll start speaking—keep in mind, this guy has been reluctant to cut rates all along. Now that he's being forced to do so, he might immediately start paving the way for a "pause in rate cuts" next time, and his tone could turn quite hawkish.

Just do the math: after the rate cut, the interest rate will drop straight to the neutral range of 3.5%. Sounds great, but inflation has already climbed to 3%, which is much higher than the Fed’s 2% target. The economic data isn’t bad either, so is it reasonable to continue easing under these circumstances? Not really.

So my take is, after the rate cut is done, the market might actually see a pullback. Personally, I’m planning to open some long-term short positions at high levels as a hedge, since the overall environment is bearish right now, and this strategy should have a decent win rate.

But looking further ahead, the second half of next year could be a turning point. Once the new Fed chair takes office, policy direction will likely change. When liquidity loosens up, and with bullish factors like Bitcoin strategic reserves kicking in, we might see a 3-5 year uptrend.

Right now is the toughest stage before dawn—the bull market is just catching its breath. Get through these next six months, and the real story is just beginning.