Pre-Market: Powell Gives Hawkish Speech as Durable Goods Miss

The new Fed Chair’s testimony was in the center of attention today pre-market, as the recent volatility and the rapid rise in rates drove attention to the central bank’s future policies even more than before. Mr. Powell ignored the volatility-driven turmoil of the past few weeks, and confirmed the gradual, data-driven rate hike schedule of the Fed.

Stocks barely budged after the much-awaited testimony and the much worse than expected durable goods orders report also failed to move the market substantially, although Treasuries edged slightly higher as the rise in yields paused. Equities continue to grind higher, burning shorts in the process, and the strength of the Dollar didn’t hurt the rally too much thus far.

Nasdaq, 4-Hour Chart Analysis

The Nasdaq is still spearheading the advance but the recovery in Apple also helped the Dow in gaining some relative strength. US stocks are still not joined by other risk assets in the bounce, with European and Asian markets remaining under pressure, and Chinese stocks notably performing weakly. The DAX index continues to struggle with the 12,500 level, despite the dip in the Euro, and that still confirms the strong divergences among the key global assets.

DAX 30 Index, 4-Hour Chart Analysis

Dollar Pushing Higher

EUR/USD, 4-Hour Chart Analysis

The USD is rallying against all of its major peers today, with the EUR/USD pair violating the 1.2250 support recently, the USD/JPY pair rising above 107 while the risk-on complex also losing ground. The two faced market is very clear on the short-term technical charts, as except US stocks, all risk assets are struggling to gain traction ever since the initial post-crash bounce.

Gold, 4-Hour Chart Analysis

Gold is also under pressure thanks to the rally in the Greenback, while oil is drifting slightly lower too, while holding on of its recent gains, as the Middle East tensions continue to support the price of the Black Gold. The main commodity-related currencies are still struggling, with both the Aussie and the Canadian Dollar trading only slightly above the lows set amid the stock market turmoil.

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Author:
Trader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.