New CPI report = doom ahead? ⛔️📉

What’s up team. Quick breakdown of the latest CPI report and what it means for stocks, crypto, and the broader markets.

Before we start, we recently released our NEW Version 2.0 of the AlgoBuddy AI Bot. 

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Ok, let’s dive right in…

Taking a look at the CPI report, inflation came in at 6.4% which was ABOVE the 6.2% forecast. A measly .1% lower than January.

Now the markets didn’t react extremely in either direction.

However, this small increase in inflation shows just how pesky and difficult it’ll be to bring inflation to the FED’s 2% target.

We have to give credit to the FED for the sharp decline from previous levels of 9% inflation.

However, seeing a fast drop from that 9% to the 2% target just isn’t likely to happen.

After this CPI report, we have a feeling that we might see inflation consolidate for a while in this current range.

Which translates to; no fun for stocks and crypto.

Why? Because it means the FED is going to have to get more hawkish on their rate hikes.

In fact, Jerome Powell said in the last press conference that they will raise rates HIGHER than expectations if inflation shows signs of entrenching.

The last .25% hike we got last month was the lowest since March of 2022. So a more hawkish FED shouldn’t come as a surprise.

Higher hikes = more pain for stocks & Bitcoin.

Speaking of, we ended up calling the recent dip on Bitcoin in our last Substack post on the 9th. You can read that one here.

Taking a look at the 4H QQQ chart, the NASDAQ ETF, we can see multiple lower highs (LH).

We’ve pretty much seen a parabolic move since the start of 2023, so a pullback to the nearest demand zone of 280-295 shouldn’t come as a surprise.

If we do dump hard, the next range to keep an eye out for would be 260-272.

Combine this with the seemingly sticky CPI and a potential ‘hawkish’ FED, and we might be seeing some pain ahead.

Who knows though. We could be totally wrong and this market could rip more to the upside. Crazier things have happened!

Once again, if you want to try out the NEW Version 2.0 of the AlgoBuddy AI Bot FREE for 7-days, click here:

Eyes peeled and stay tuned for the next one.

Cheers!

-The AlgoBuddy Team