higher for longer? - how we're trading it
Hey team.
Back in your inbox again with another market brief.
We breakdown the exact levels we’ll be eyeing up this week, how to digest Powell’s latest comments, and more.
Let’s jump in!
Impact Snapshot
Powell signals high rates for longer amid persistent inflation
Market Evaluation
The S&P 500 remains largely unchanged following Powell warns that rates need to remain higher for longer.
The Federal Reserve chief said it will likely take longer to have confidence on inflation given the recent lack of progress.
Powell also said it’s appropriate to give the Fed’s restrictive policy further time to work.
“The recent data have clearly not given us greater confidence, and instead indicate that it’s likely to take longer than expected to achieve that confidence” he said during a central banking forum.
Powell’s remarks represent a shift in his message following a third straight month in which a key measure of inflation exceeded analyst forecasts.
Markets Breakdown
After Monday’s pullback, market lacked confidence for clear downside continuation following up in today’s session.
Market saw range-bound activity around the settle pivot as traders anticipated Powell’s speech for further clues of the interest rates situation.
As stated early in today’s market report over on X, the settle would have “set the tone” for the day.
Buyers and sellers continued to trade this pivot as fair price with the POC of the session sitting at 5100.
Despite the market performing a lower low relatively to yesterday’s session, the “tempo/pace” that this occurred was very slow.
Our main focus is establishing value above the key 5100s in order to target continuation towards last Friday’s range.
ES
The targets we look for until NY close and overnight session:
Upside Levels: 5137/5154/5176
Downside Levels: 5070/5058/5035
That’s all we got for you today.
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We’ll see you on Thursday!
-The QuantVue Team
Disclaimer: Futures and options trading carries a significant level of risk and may lead to substantial financial losses. The content provided in this newsletter is solely for informational purposes and should not be construed as a trade recommendation or financial advice. It is essential for readers to independently assess and make their own investment decisions, taking into consideration their personal financial situation and risk tolerance.