Market Focus Analysis:
Pulse Focus 1: Federal Reserve Governor Waller stated last night that if core inflation remains high, the Fed would have to consider tightening monetary policy. Immediately afterward, market expectations for a 25-basis-point rate hike at the next meeting rose above 50%.
Focus Analysis: Oil prices have dropped nearly 20–25% from above $100; meanwhile, the previously released Eurozone June CPI also showed a significant decline; and expectations for U.S. CPI are likewise easing. Therefore, a downward revision in tonight’s CPI data is highly likely. Investors should prepare to position for a potential market reversal.
Asset update: After dropping near 4,000, London gold has temporarily stabilized. Prices have been under pressure from geopolitical sentiment over the past three trading sessions. A short covering rally may occur during the day ahead of the CPI data release. We recommend monitoring for rebound signals during daytime trading and securing profits after the CPI data shows a decline.
Pulse Focus 2: At 10 p.m. Beijing time tonight, Federal Reserve Chair Wash will appear before the House Financial Services Committee for a hearing on the “Federal Reserve’s Semiannual Monetary Policy Report.”
Focus Interpretation: Following the CPI data release, markets will closely watch whether Wash comments on the current inflation environment. Given that Wash previously expressed views suggesting inflation is easing, if he continues to maintain such remarks after the CPI data, it could likely lead to a decline in the recently heightened expectations for rate hikes.
Asset reminder: The US Dollar Index (DXY) is currently consolidating within a range between 100.60 and 101.35, positioned near the upper boundary of this range. If Wash continues to maintain his narrative of “moderate inflation,” the dollar could reverse course and test lower levels at 101, 100.80, and 100.60.
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Gold: After yesterday’s price swept through the liquidity in the yellow zone, there was no clear rebound. A short covering move may emerge during the day ahead of the CPI data release. Therefore, we will closely monitor momentum signals around the 4020 level during daytime trading. However, after the evening CPI data release, we recommend protecting profits and waiting for Wash’s speech. For detailed positioning, please consult the plugin.
(Gold 15-minute chart)
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Nasdaq: After yesterday’s sweep in the yellow zone of the plugin, the rebound was modest. Today we will continue monitoring liquidity sweeps around 2900. Tonight’s CPI data and Powell’s testimony could both trigger significant volatility. For detailed positions, please consult the plugin.
(NASDAQ 15-minute chart)
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Crude oil: After the initial wave of price movement swept through the yellow zone liquidity yesterday, a clear decline emerged. However, due to the ongoing escalation of tensions between the U.S. and Iran, prices subsequently rose toward 80. For today, we recommend seeking more definitive signals and waiting for a downward breakout from the triangle consolidation pattern before looking for shorting opportunities upon a rebound. For detailed levels, please consult the plugin.
(Crude Oil 15-minute Chart)
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Today’s key financial data and events to watch:
20:30 U.S. June CPI Year-on-Year (Unadjusted)
22:00 Federal Reserve Chair Wash attends the House Financial Services Committee hearing on the “Federal Reserve’s Semiannual Monetary Policy Report”
