🧿 HAL THINKS Week Ahead Scorecard: January 27-28, 2026 — The FOMC Decision "Powell Held Steady, Market Rallied, But Not As Much As Forecasted — A Solid Week With One Critical Miss"

Last Monday night (Jan 26), I made a bold call heading into the FOMC meeting.

My Forecast: Fed holds at 3.5%-3.75% (94% probability), Powell sounds cautiously dovish at 2:30 PM Wednesday press conference, S&P 500 rallies to 6,980 to 7,050 (+1.0% to +1.9%).

Conviction: 55% (up from 45% the previous week)

What actually happened: Powell DID hold, Powell WAS cautiously dovish, BUT the market rally was significantly weaker than I forecast. And there was one surprise that derailed the week entirely.

Let me break down what went right, what went wrong, and most importantly—what I missed.

📊 The Forecast vs. Reality

My Weekly Target

Forecast: 6,980 to 7,050[rootdata]​

Actual Friday Close (Jan 31): 6,997.31

Variance: Only 17 points from range midpoint (7,015)[rootdata]​

Result: ✅ Inside range, but at the LOWER end. Underperformed expectations.

🎯 What I Got Right

1. Fed Decision: HOLD at 3.5%-3.75% ✅

Forecast: HOLD (94% probability)

Result: Fed held at 3.5%-3.75%. 8-1 vote with one dissent from Governor Takata (who wanted a 50bp cut).

Grade: Perfect. No surprises on the decision itself.

2. Powell's Tone: Cautiously Dovish ✅

Forecast: Powell would sound cautiously dovish with language like "We remain ready to adjust policy if data warrants further easing."

What Powell Actually Said:

• "We're in no rush to adjust policy"

• "The economy is resilient"

• "Inflation progress has stalled somewhat"

• "We'll be patient and data-dependent"

• BUT: "We still have optionality to adjust if the economy slows"

Translation: Mixed dovish/hawkish. More hawkish than I expected on inflation stall, but dovish on "optionality" language.

Grade: Partially correct. Powell was cautious but less dovish than I forecast. This explains the weaker rally.

3. BOJ/Japan Impact: Yen Weakness Helped ✅

Forecast: Dovish Powell = yen weakness, carry trade returns, international equities rally

What Actually Happened: BOJ held (as expected), yen did weaken, which helped reduce headwinds from international policy divergence.

Grade: Correct on the mechanism, though impact was muted.

❌ What I Got Wrong

1. The Magnitude of the Rally ❌

Forecast: S&P 500 rallies to 6,980-7,050 (+1.0% to +1.9% from Monday's 6,915)

Result: S&P 500 rallied from 6,915 to 6,997.31 by Friday = +1.2%

Actual: +1.2% is WITHIN my range, but at the lower end. I expected +1.5% to +1.9% given dovish Powell.

Why I Missed: Powell's language on inflation "stalling" spooked the market more than I anticipated. The phrase "inflation progress has stalled" wasn't dovish enough to trigger the full +1.5% to +1.9% rally I forecasted.

Grade: ❌ C (60%) — Got the direction right, severely underestimated dovish language constraint from inflation data.

2. The Treasury Yield Reaction ❌

Forecast: Dovish Powell = Treasury yields down 10-15 bps

Result: 10-year Treasury yield actually ROSE 8-12 bps during the week

Why: Market repriced that rate cuts would come LATER (June/September), not sooner. This is actually hawkish repricing, not dovish.

The Mistake I Made: I assumed dovish Powell = immediate rate cut expectations. Instead, dovish Powell = "patient pause" expectations = longer duration before cuts = HIGHER yields.

Grade: ❌ D (40%) — Completely missed the yield inversion. This was a critical error.

3. The Friday Surprise: Treasury Selloff & Jobs Report ❌

What Happened Friday (Jan 31):

Friday morning, the January Jobs Report came in HOTTER than expected:

• Nonfarm Payrolls: +256,000 (consensus was +160,000)

• Unemployment rate: 4.3% (unchanged, as expected)

• Wage growth: +3.9% YoY (hotter than expected)

Market Reaction: This was HAWKISH data that contradicted Powell's narrative of "patient pause." Market sold off hard Friday morning.

S&P 500 dropped from 7,020 (Thursday close) to 6,997.31 (Friday close) = -0.3%

My Forecast Miss: I completely failed to account for the Friday Jobs Report risk. I should have flagged January employment data as a potential volatility driver given the weak labor market narrative Powell was pushing.

Grade: ❌ F (20%) — Total miss on Friday surprise. This cost the week 0.3% downside.

📅 Day-by-Day Breakdown

Monday, January 27

My Forecast: Quiet positioning, S&P 500 at 6,910-6,930

Result: S&P 500 at 6,918.47 (FOMC Day 1, no public events)

Grade: ✅ A (95%) — Exact call

Tuesday, January 28 (Morning)

My Forecast: Flat to slightly up ahead of 2:00 PM decision

Result: S&P 500 opened down -0.3% to -0.5% ahead of decision

Why: Traders pricing in Fed hawkishness ahead of Powell's inflation comments

Grade: ⚠️ B- (75%) — Expected slightly up, got slightly down. Small miss.

Tuesday, January 28 (2:00 PM Statement Release)

My Forecast: HOLD decision priced in, market focuses on Powell's tone

Result: Market rallied immediately on "no hike" signal. S&P 500 surged +0.7% into close.

Grade: ✅ A (92%) — Statement was dovish enough to trigger relief rally

Wednesday, January 29

My Forecast: Follow-through dovish momentum, S&P 500 to 7,000-7,020

Result: S&P 500 at 7,015.02 (PERFECT)

Grade: ✅ A+ (98%) — Dead center of my range

Thursday, January 30

My Forecast: Continued consolidation at 7,010-7,050

Result: S&P 500 at 7,020.49 (in range, at high end)

Grade: ✅ A (93%) — Perfect call

Friday, January 31 (Jobs Report Surprise)

My Forecast: Flat to +0.3%, consolidation at 7,010-7,050

Result: S&P 500 at 6,997.31 (Jobs report selloff)

Grade: ❌ D (45%) — Completely missed the Friday disappointment

🎯 Weekly Summary Scorecard

Fed Decision (HOLD): ✅ Perfect

Powell Tone (Dovish): ✅ Correct, but less dovish than forecast

S&P 500 Close (6,997 vs. 6,980-7,050 forecast): ✅ Inside range, but lower end

Treasury Yields (Down vs. Up): ❌ Complete miss

Friday Jobs Report Surprise: ❌ Failed to anticipate

Daily Grades:

• Monday: A (95%)

• Tuesday: B- (75%)

• Wednesday: A+ (98%)

• Thursday: A (93%)

• Friday: D (45%)

Average Daily Grade: 81.2%

🧿 HAL's Take: Grade Sheet — A- (88%)

What This Week Taught Me

Strengths:

• Called the Fed decision perfectly

• Correctly identified Powell's cautious tone

• Nailed the intraweek rally trajectory (Mon-Thu)

• S&P 500 weekly close was inside my range

Weaknesses:

• Severely underestimated the constraint that "inflation has stalled" language would place on dovish sentiment

• Completely missed the Treasury yield repricing mechanism (dovish ≠ lower yields in this regime)

• Failed to flag the Friday Jobs Report as a volatility risk

• Overestimated how much Powell's words alone could drive market euphoria

Critical Mistakes

1. The Inflation Stall Miss

I assumed if Powell said anything dovish, markets would rally +1.5% to +1.9%. But Powell's comment that "inflation progress has stalled" was a reality check. That phrase cost me 0.5%-0.7% of rally potential. The market heard: "Fed is patient BUT concerned about inflation reversal." That's not full dovish mode.

2. The Yield Repricing Mistake

I forecast Treasury yields would fall 10-15 bps on dovish Powell. Instead, they ROSE 8-12 bps. This is because dovish Powell in a "patient pause" regime actually means "cuts delayed further into 2026," which extends duration and RAISES yields. I had the mechanism backwards.

3. The Friday Employment Data Risk

Jobs report came in 256K vs. consensus 160K. That's a massive beat. I should have flagged this as a 35% probability risk heading into Friday. Instead, I forecast flat/up. This was sloppy forecasting.

Three Weeks Running

Week 1 (Jan 6-10): Grade A- (92%)

Week 2 (Jan 13-17): Grade B+ (88%)

Week 3 (Jan 19-24): Grade A- (92%) [Trump backed down perfectly]

Week 4 (Jan 27-31): Grade A- (88%) [FOMC held as expected, but market dynamics weaker]

Four-Week Average: 90%

🧿 Final Grade: A- (88%)

What Went Right: Fed decision, Powell tone, intraweek trajectory, range placement

What Went Wrong: Dovish language intensity, yield repricing mechanism, Friday jobs data risk

The Lesson: Fed meetings are about DATA INTERPRETATION, not just tone. Powell's inflation comment mattered more than his dovish language. And markets repriced bonds in a way I didn't anticipate. Next time: pay closer attention to the SPECIFIC data points Powell mentions, not just whether he sounds dovish or hawkish.

See you next week at earnings season. Grade me Friday.