Cooling CPI Inflation Strengthens Case for Fed to Hold Rates in September

The cooling CPI data could increase the likelihood of a Fed rate cut in September, thereby supporting risk appetite. Technically, the SPX is above its 50-day moving average and the RSI is in neutral territory, indicating room for upward movement. However, the MACD is below its signal line and the price is slightly below the 20-day average, warranting caution in the short term. Although the news flow is positive, the market may take time to price in this data and break through resistance levels. Therefore, the bullish expectation can be expressed with moderate confidence.

Cooling CPI data could boost risk appetite by increasing the likelihood of a Fed rate cut in September. The NDX index is slightly positive over the past 24 hours, with RSI at 49.6 in neutral territory. MACD remains positive but below the signal line. Price is just below the SMA20 but above the SMA50, indicating a solid medium-term trend. In the short term, news flow and technical levels may allow the index to attempt an upward move, but the SMA20 resistance (29622) should be watched as the first hurdle.

Cooling CPI inflation could put pressure on the dollar index (DXY) as it increases the likelihood of a Fed rate cut in September. The RSI being in oversold territory at 23.9 suggests a possible short-term bounce, but the overall trend remains downward. The MACD being below the signal line and in negative territory confirms weakness. The price being below the 20- and 50-day moving averages indicates that the downtrend may continue. However, due to oversold conditions, the pace of the decline may be limited, so the confidence level is kept at medium.