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nerdzvest Insight
Expect market to range prior to FOMC and move up post the announcement of an anticipated 75bps hike
Major indices were positive for the past week with no surprises appearing. Participants have turned buoyant with expectation that inflation might have peaked. However, it is still unclear if such rally is sustainable as we are still facing supply chain crunch and inflationary pressures. All of these might take some time to be resolved.
Looking forward to the coming week, we will have July FOMC announcement which is likely to be the main event that might drive the direction of the markets. Despite the initial fears of a 100bps hike, it seems that the market participants are anticipating a 75bps hike to curb the high inflation rate reported earlier this month. The Nerdz agrees with that view and believes that this will bring calm to the participants that Fed is trying their best to curb inflation sensibly. This is likely to cause the markets to be moving sideway before the announcement and then a rally post that. However, it could highly depend on the speech post the announcement which The Nerdz thinks that Powell will sing the same tune as previous which might see the markets inch up further.
Nerdz Indicator
Short Term: Cautious
Medium Term: Neutral to Bearish
Long Term: Opportunistic
Key Happenings
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