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Forex Today: US CPI in Focus on Wednesday

By Christopher Lewis
Senior Technical Analyst

Christopher Lewis is a technical analyst and market commentator at DailyForex with more than two decades of trading experience in Forex and other leveraged markets. Based in Columbus, Ohio, he specializes in chart-based analysis of major currency pairs, stock indices, commodities, and energy markets, focusing on clear support and resistance levels, trend structure, and risk management. Christopher produces daily written and video analysis for tra...

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  1. The S&P 500 slid on Tuesday, as hopes of a US-Iran deal fade, with headlines continuing to put pressure on risk appetite. The Dow Jones also slid, dropping 180 points with similar fears, as leaders in both countries are now demanding reparations.

  2. On Wednesday, the US CPI report will come out, which could cause a significant amount of volatility, as the recent jobs report was a big miss. The FedWatch tool at the CME suggests that there is a 55% chance of a rate hike in September, so this has inflationary reports and the employment number early next month offering even more insight than usual. The Gold market has been strong over the last few sessions, as traders have bet that there will be fewer rate hikes than once thought. Core CPI is expected to be 2.5% year-over-year.

  3. Nvidia is developing a new AI model family called Nemotron 4, with the idea of challenging some of the top open-source models globally. The news was released on Tuesday, and this will be of interest for consumers, as cheap Chinese models are starting to reach near the capabilities of top systems from leaders like Anthropic and OpenAI.

  4. Crude Oil rolled over on Tuesday after initially rallying, as Iran and Oman have reached an advanced stage in the negotiations. However, Iran still demands compensation from the United States, casting some doubt on a longer-term, broader deal globally. Oil ended up falling 1.28% for the session.

  5. The USD/JPY pair remains in focus, as the recent intervention made headlines. It was a combination of the Bank of Japan and the Americans selling the pair to help support the yen, but now the market has already gained about half of the losses. Traders continue to focus on the carry trade, despite the 8.45 trillion yen worth of purchases by the central banks on July 30 and 5.3 trillion yen on July 31. Traders will be watching this pair closely, as there have been a few other interventions as well.

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Senior Technical Analyst
Christopher Lewis is a technical analyst and market commentator at DailyForex with more than two decades of trading experience in Forex and other leveraged markets. Based in Columbus, Ohio, he specializes in chart-based analysis of major currency pairs, stock indices, commodities, and energy markets, focusing on clear support and resistance levels, trend structure, and risk management. Christopher produces daily written and video analysis for traders who rely on technical setups to navigate volatile market conditions

As seen on: Pairs Of Aces Podcast,The Trader Guy, FXEmpire

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