The initial reaction was toward the hawkish side and then recovered but is now moving toward the more hawkish bias after the Fed Powell's speech. I am not sure things changed much, but the Chair did reiterate the need to get rates higher. The verdict is still out on 50-75 and the terminal rate, but perhaps the feeling is 3.4% might be too low for the end of the year and the Bullard call for 3.75% to 4% is more likely.
Stocks are lower. The snapshot at 10 AM had the Dow up 52 points, The S&P down -2.07 points and the Nasdaq -27.01 points.
The current levels are at:
- Dow is down -386 points or -1.4%
- S&P is down -56 points ro -1.33%
- Nasdaq is down -199 points or -1.60^
For yields, the before and after showed:
- 2 year moving from 3.374% to 3.425% currently
- 10 year from 3.045% to 3.069%
- 30 year from 3.254% to 3.257%
IN the forex,
- EURUSD is back below the 200 hour MA at 1.0041 and tradign at 1.0038 currently.
- GBPUSD: The GBPUSD briefly moved above the 200 hour MA at 1.18902, but is back down looking more toward the 100 hour MA at 1.18047
- USDJPY: The USDJPY moved down to test its 200 hour MA at 136.22, but has shot back higher and is trading above its 100 hour MA at 136.89. The price is currently trading at 137.10.
- USDCHF: The volatility pushed the price below its 200 hour MA briefly at 0.9991, but is back higher but still below the 100 hour MA above at 0.96418. The current price is currently at 0.96178.
Volatility with a hawkish tilt is now the theme.
PS. Stocks declines are accelerating with the Nasdaq now down -1.95%. The S&P is down -1.6%