Wall Street races against time ahead of Federal Reserve’s meeting

Wall Street’s in a tight spot as everyone braces for the Federal Reserve’s upcoming meeting. Since their last gathering in late July, the market’s been on a wild ride. Early August was a mess—three straight days of losses for the SP 500, with a particularly nasty 3% drop on August 5. 

It’s clear that fears over the U.S. economy have hit hard, and traders are on edge, expecting the Fed to step in with a rate cut. In fact, the odds of at least a quarter-point reduction are sitting at 100%, according to the CME Group’s FedWatch tool.

But the market didn’t stay down for long. Wall Street’s bounced back since that rough start to August. The SP 500 has seen gains in eight of the last nine sessions, climbing nearly 8% above its August low. 

Right now, it’s just a hair—less than 1.5%—from the record high set back in July. Optimism is creeping back in, with some saying the U.S. economy might dodge the worst-case scenarios. 

Market hopes and the Fed

Investors are anxiously waiting for the Fed’s meeting. Back in July, the Fed kept rates steady, even though they were patting themselves on the back for making progress on inflation. But things have changed fast. 

August’s second-quarter earnings weren’t as stellar as before, and a few companies really flopped on their forecasts. That added to the early August chaos. 

Yet, overall, earnings didn’t totally disappoint, and most companies kept their guidance intact with only minor tweaks. This has helped the market recover a little bit.

While stocks are getting some love, Bitcoin is having a rough time. Its price dipped below the critical $60,000 level, falling nearly 3% to around $58,140 as of press time. 

The next challenge for Bitcoin is breaking through the $61,000 to $62,000 range. If it manages that, there’s a chance it could make a run at its all-time high. 

But if Bitcoin can’t bounce back above $60,000, things could get ugly fast, with the price possibly sliding down toward $54,000 in the near term.