Powell 'Put" breached at 3968 last support at 3933. The S&P 500 is now looking vulnerable to wipe its July 2022 gains. IS the mad scramble to avoid rates rises about to run dry?

Chart 1

Chart 2

The Powell 'Put' has been breached at 3968, whilst the technical support of  3933 is still holding, but only just, which is quite amazing if you think about how the 27th July 'Put' support was given after Jerome Powell's ambiguity in offering any clear market direction on inflation and recession, after the Fed gave its July 0.75% rate rise, markets rallied and by metaphor a 'put' was created,  Until after the Fed's Jackson Hole meeting (26th August), which indicated to the market that the Fed simple cannot drag their feet on rate rises as inflation in America may start to spiral out of control and the U.S. government has run of options re: Strategic Petroleum Release and lowering the price of fuel at the pump.  Markets therefore tanked, as a blunt direction was given by Powell and the Fed.   Rates have too go up.

What will be interesting is if the Iran deal goes ahead and oil prices do drop, the question will be; By how much?  And will lower costs be passed on to the consumer?  When overall operational costs to produce, store and transport oil are still going up.  This is all pointing towards an imbedded inflation (energy and food) that only a strong U.S. dollar can tame.

Chart 1 shows the swing trade down, 3980 (08/30) to 3936 (08/31)

Chart 2 shows a short position under the 3933 support.

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"The wise man doesn't know anything"