S&P 500 — US Large Cap Index
FTSE 100 — UK Blue Chips
Euro Stoxx 50 — Eurozone Leaders
DAX 40 — German Equities
CAC 40 — French Market Index
Nikkei 225 — Japan Benchmark
Hang Seng — Hong Kong Index
Shanghai Composite — China Mainland
ASX 200 — Australian Market
TSX Composite — Canada Index
Nifty 50 — India Large Cap
STI Index — Singapore Market
KOSPI — South Korea Index
Bovespa — Brazil Equities
JSE Top 40 — South Africa Index
IPC Index — Mexico Market
Bitcoin and U.S. equity indices fell sharply around 1.5 hours after Fed Chair Kevin Warsh finished his speech. Following the Chair’s remarks, the probability of a 25 bp Fed rate hike at the September meeting rose to 57.5%, according to CME FedWatch. That would mean raising the federal funds target range by a quarter percentage point next month.
- Just yesterday, one day before Kevin Warsh’s Jackson Hole speech, markets were pricing in only a 35.4% chance of a September rate hike, but expectations for tighter policy increased sharply after Warsh’s hawkish remarks.
- The current probability is also slightly higher than a month ago, when markets assigned a 55.8% chance to policy tightening.
- Warsh’s tone, together with the strong emphasis he placed on price stability and bringing inflation back to target, supported the U.S. dollar and Treasury yields, while weighing on risk assets such as equities and Bitcoin, where profit-taking is now visible.
US500 charts (D1, H1 intervals) and Bitcoin (H1 interval)
On the broader daily timeframe, the S&P 500 futures contract remains relatively stable, although the long upper wick on today’s candle points to significant selling pressure. However, with around four hours still left until the market close, it is too early to determine whether sellers will remain dominant into the final part of the session.
Source: xStation5 On the hourly timeframe, however, sellers are clearly in control. The contract is testing the 200-period moving average on the H1 chart (red line) and needs to hold the area around 7,700 points to avoid a deeper pullback.
Source: xStation5 In Bitcoin’s case, the move has been more pronounced. Warsh’s hawkish message provided a convenient trigger for profit-taking, pushing BTC toward $77,000 from around $80,000 tested yesterday. A stronger U.S. dollar could also limit ETF-related buying activity in the coming days.
Source: xStation5
