Powell on the Hill

Outlook 07/14: U.S. stock futures point to a bullish open after PPI data and Powell speech prepared for the House Financial Services Committee. Powell said that the economy needs to improve more before the central bank will change its ultra-easy monetary policy. Powell noted that the Fed’s benchmark of “substantial further progress” toward full employment and stable prices remains “a ways off.” He did remark that Fed officials at least are talking about reducing the pace of asset purchases. On inflation, Powell said it “has increased notably and will likely remain elevated in coming months before moderating.” But he stuck to his oft-stated belief that the current surge is temporary and will be offset as conditions return to normal.

/ESU21: YVAH 4376 YPOC 4367 YVAL 4361 GAP 4361

/ES Plan: Yesterday market closed bearish, but overnight looks more bullish, moving above yesterday's value, so these are the initial balance options for today:

A) If market remains above YVAH 4376 with bullish internals, buy towards  ONH 4380.50 ATH 4383.75 and PBT 4400.

B) If market moves below YVAH 4376 with bearish internals, sell towards YVAL-GAP 4361 ONL 4350 and HVE 4348.

Note: Market opens above previous value area and it's a clearly bullish signal. But, if market begins to trade within value with volume increasing, 'Value Area Rule (VAR)' comes into play. 

Market Movers

10:00 Atlanta Fed's Business Inflation Expectations

10:30 EIA Petroleum Inventories

12:00 PM Powell Testifies on Semi-Annual Monetary Policy Report

1:30 PM Fed's Kashkari Speech

2:00 PM Fed's Beige Book

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