Warsh's Jackson Hole Address Set to Spark Market Volatility
Federal Reserve Chair Kevin Warsh will address the Jackson Hole conference on August 29, amidst market expectations of one 25bp hike by year-end. Gold has surged 7.1% in the past week, reaching $4,642.58, but Citi warns that this price increase is vulnerable to a hawkish surprise from Warsh.
The Dollar Index (DX) is already flashing a Strong Sell signal on daily and weekly timeframes, with an RSI of 35.9 approaching oversold territory. A dovish speech from Warsh could accelerate the dollar's slide toward its weekly support at 97.80.
Rate-sensitive assets are coiled around one question: will Warsh signal patience or further tightening? The entire complex is waiting for guidance on the Fed's forward policy, with the 2-year yield at 4.221% reflecting growing conviction that the easing cycle is over.