Markets Whipsaw on Powell Rumors, Focus Shifts to U.S. Data and Earnings

Hello traders, and welcome to Thursday. If you’re just opening your charts this morning, you might be wondering what happened — because yesterday was a textbook pump-and-dump scenario fueled by politics, rumor, and rapid reversals.

The chaos began late in the European session and into the early U.S. session, when headlines broke that Donald Trump had drafted a letter to fire Fed Chair Jerome Powell. Markets didn’t hesitate:

• Indices dropped hard.

• The U.S. dollar sold off sharply.

But the drama didn’t last. Shortly after, Trump publicly denied any plan to fire Powell, calling it “highly unlikely.” That triggered an equally fast rebound:

• Indices reversed and rallied, erasing the earlier drop.

• The dollar strengthened again, pulling back lost ground.

As a result, major FX pairs like GBP/USD and EUR/USD showed big upside spikes, only to fully reverse by the close. Anyone not watching live would see only the aftershocks — but now you know what caused them.

Beyond politics, we also had U.S. PPI (producer inflation) come in below expectations. Normally a market mover, the data was overshadowed by the Powell saga.

This morning’s calendar has already delivered some surprises:

• Australia’s job data missed forecasts, sending the Australian dollar sharply lower — currently the weakest currency in the pack.

• From the UK, claimant count change came in higher than expected (worse for the pound), but the British pound is holding strong, one of the top performers so far.

Looking ahead today:

• We’re waiting on U.S. retail sales and unemployment claims, both of which could spark more volatility depending on how they land.

Earnings season is also heating up:

• Yesterday: Bank of America, Morgan Stanley, Goldman Sachs, and Johnson & Johnson all beat expectations.

• Today: Watch for reports from Taiwan Semiconductor, Netflix, Novartis, and PepsiCo — some of the biggest names to hit the tape today.

In futures, the mood has flipped. After yesterday’s reversal, both U.S. and European futures are trading higher into the European open, signaling renewed risk appetite.

In commodities, we saw a whipsaw move in gold on Wednesday, but this morning brings a mild bearish correction across the board in gold, silver, and other metals.
Oil is ticking higher in early trading, but the move is minor and lacks momentum for now.

The dust is settling, but volatility is still in the air — and with U.S. data and major earnings still ahead, we’re likely not done yet.

Source: https://www.axiory.com/analytics/market-news/markets-whipsaw-on-powell-rumors-focus-shifts-to-u