US July Inflation Comes in Below Expectations

Inflation coming in below expectations could increase the likelihood of the Fed cutting interest rates and support risk appetite. Technically, the price is above the 20-day and 50-day moving averages, with the RSI at 57 in a neutral-to-positive zone. Although the MACD line remains below the signal line, staying in positive territory indicates that momentum has not fully faded. A short-term upward move is possible, but the impact of macro data may remain limited. Therefore, the direction is upward, with moderate confidence.

July inflation coming in below expectations could strengthen market expectations for a Fed rate cut and support risk appetite. Technically, the NDX is trading above its 20-day and 50-day moving averages, with the RSI at 62.8, maintaining an upward trend without approaching overbought territory. Although the MACD line is below the signal line, it remains in positive territory, indicating that momentum is still favorable. In the short term, this positive news flow and technical outlook could support the index's upward movement, but excessive optimism should be avoided.

Inflation coming in below expectations could strengthen the case for the Fed to slow or end its rate hike cycle, putting pressure on the dollar. Technical indicators also support this outlook, with the RSI in weak territory at 36 and the MACD trading negatively below its signal line. The price is trading below the 20- and 50-day moving averages, and the short-term downtrend persists. However, the decline is expected to be limited, as the inflation data alone may not trigger a sharp selloff. Therefore, while the bias is to the downside, I foresee a weak performance rather than a strong drop.