Consolidation Sentiment Persists Ahead of Jerome Powell's Testimony
June 21, 2023 - The beginning of this shortened holiday week saw some minor downward movement in the major indices. Currently, it seems that a modest approach to price action will be favored.
There is a lack of strong conviction in the futures trade. This can be attributed, in part, to market participants awaiting potential stronger selling pressure after the significant rally experienced since late May.
Interestingly, the focus lies not so much on Powell's prepared testimony, but on his responses to questions from committee members. Mr. Powell is likely to:
affirm the resilience of the banking system
mention that the inflation adjustment process is still ongoing, and
reiterate his belief in the possibility of a soft landing.
This is essentially what he stated in his previous FOMC press conference a week ago, so it would be illogical for him to present significantly different views only a week later.
Disclaimer: The information provided in this article is for educational purposes only and should not be considered financial advice. Always conduct thorough research and consult with a professional financial advisor before making any investment decisions.
