📌 Market Outlook: Quiet Adjustment Ahead of Powell’s Speech
💱 Key Event: Powell’s Jackson Hole Address
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Focus: September FOMC rate cut outlook & the independence of the Fed.
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Scenarios:
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Dovish (rate cut hint) → U.S. yields lower, dollar selling → support for equities & risk assets.
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Hawkish / Emphasis on independence → U.S. yields higher, dollar buying → pressure on equities.
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📊 Economic Data Backdrop
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Employment data: Clear weakness, reinforcing rate-cut expectations.
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CPI: Headline below forecast, but sticky core → market still pricing cuts.
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PPI: Higher than expected → lingering inflation concerns.
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Current stance: Market has priced in a ~80% probability of a 25bp cut in September.
💹 Technical Analysis (Key FX Pairs)
USD/JPY
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Current level: mid-148s
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Resistance: 149.20 → 150.00
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Support: 147.50 → 146.80
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Daily: 25-day MA (147.80) holding as support.
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Scenario: Holding above 148.00 opens a test of the 149s.
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Dovish Powell → risk of break below 147.00.
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EUR/USD
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Current level: around 1.1580
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Resistance: 1.1650 → 1.1700
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Support: 1.1550 → 1.1500
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4H chart: Downtrend paused, consolidation near 1.16.
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Scenario: Dovish Powell → breakout above 1.1650 for short-term rebound.
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Hawkish Powell → break below 1.1550, risk of testing low-1.15s.
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GBP/JPY
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Current level: around 198.00
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Resistance: 199.50 → 200.00
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Support: 197.00 → 195.50
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Daily: Pressured by weak UK CPI, but 200.00 remains key psychological ceiling.
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Scenario: Risk-on continuation → attempt to break 200.00.
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Weak UK fundamentals + hawkish Powell → risk of drop below 197.00.
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📌 Strategy Summary
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USD/JPY: Favor dip-buying near 148.00, but keep position sizes light ahead of Powell.
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EUR/USD: Base case = sell on rallies, but break above 1.1650 allows for a rebound scenario.
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GBP/JPY: Sell rallies if UK data stays weak; 200.00 break likely temporary.
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Overall: Market remains directionless until Powell → best approach is to prepare for a one-way trend post-event.
