Pulse of the Markets Report 8/25/23: Dow Distress and Fed Funds Futures

Equities faced pressure yesterday, largely driven by the surging strength of the US dollar, as investors braced for Federal Reserve Chair Powell's pivotal appearance at the Jackson Hole symposium.

Under the weight of a robust dollar, market distress reverberated throughout various sectors, pushing the Dow Jones Industrial Average to fresh correction lows. This decline also marked a notable technical setback as both the Nasdaq 100 and S&P 500 indices grappled with resistance at their respective 50-day moving averages.

Today's attention is squarely fixed on two critical levels: 4335 and 14550, which serve as key reference points within the ongoing correction for each of these indices (in terms of cash values).

The dollar's performance and developments in interest rate markets will continue to be significant factors, along with the movements in Fed Funds Futures. These futures contracts will offer insights into whether Powell's remarks are influencing expectations for future policy rates in the United States.

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