Hey Prop Traders, here’s are some valuable tips, terms explained and prop firm news for October 30, 2025

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What’s Next for Stocks After October Fed Rate Cut?

The Fed just pulled the trigger on another 25-basis-point rate cut - the second one this year and instead of celebrating, the market flinched.

If you’re wondering why, you’re not alone. Inflation’s cooling. Growth hasn’t fallen off a cliff. The S&P 500 is sitting right around all-time highs. On paper, this should’ve been a “risk-on” moment the kind of setup traders dream about.

But the tone shifted fast once Jerome Powell stepped up to the mic.

A Split Fed and a Careful Powell

Powell tried to thread the needle. He admitted the economy’s cooled enough to justify another cut, saying inflation’s moving in the right direction and the labor market’s stabilizing.

Then came the pivot: he said the Fed hasn’t decided what comes next in December.

Translation? Don’t get too comfortable.

He also made it clear he doesn’t see job weakness accelerating. The government shutdown, he said, is a short-term drag - one that should reverse when things reopen.

But the fireworks came from inside the Fed itself. Governor Miran and Schmid dissented, with Miran pushing for a 50-bp cut and Schmid voting against any cut at all. That’s a rare split vote and it shows just how divided the Committee really is.

That disagreement rattled traders. Stocks, which had rallied going into the announcement, sold off after Powell spoke as the market tried to digest what “data dependent” actually means this time.

Relief or Repricing?

Powell’s message was calm, but not comforting. The market wanted confirmation that another rate cut is coming in December. Instead, Powell basically said, “We’ll see.”

That uncertainty leaves room for chop. November could bring a real tug-of-war between bulls betting on a soft landing and bears calling for a slowdown. Don’t be surprised if we get a shakeout before the next leg higher.

The market’s priced in a lot of optimism. Now it needs proof in the form of earnings and credit conditions to keep pushing higher.

The Historical Edge

Here’s the bullish stat everyone’s talking about. According to Ryan Detrick, CMT, there have been 21 times since 1980 when the Fed cut rates while the S&P 500 was within 2% of all-time highs.

What happened next?
Stocks were higher one year later every single time. The average 12-month gain: +14.3%.

Those weren’t panic cuts, they were fine-tuning moves made while the economy was still expanding, profits were growing, and credit markets were steady. The Fed was adjusting, not saving.

That’s what makes this cycle so tricky. The setup looks good, but the real story over the next 6 to 12 months will come down to earnings revisions versus real rates.

The Real Test: Earnings vs. Rates

If companies keep revising earnings higher, the Fed drifts toward neutral, and credit spreads stay calm, this market can grind higher. But if growth slows, margins compress, or credit tightens, history won’t bail you out.

Right now, the message is clear: don’t fight the trend, but don’t fall asleep at the wheel either.

The Fed just turned the dial, now it’s up to the market to prove this rally has legs.

Trading the Volatility Ahead

We’re heading into a high-volatility stretch. Expect bigger intraday swings, fake breakouts, and fast reversals. For traders, that can mean opportunity but only if you manage risk like a pro.

That’s where Axi Select comes in. It’s a trader-first prop firm built for volatile markets. There are no daily drawdowns, no challenge fees, and a 10% max drawdown that gives you the space to trade through the noise without blowing up.

If you’ve got a view on where stocks are headed next, don’t just watch it play out - trade it.

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