In the early hours of the morning, the Fed fired warning shots at the world

At 2:00 a.m. Beijing time on Thursday, the minutes of the Fed meeting were released, which were more hawkish than market expectations.

Fed minutes are minutes and summaries of the Fed's monetary policy meetings and are important to the public and markets because they provide insight into the Fed's policy thinking and decision-making process.

| The minutes are a detailed record of the Fed's discussions and decisions, which contain the opinions, analysis, data, economic forecasts and basis for policy decisions of the participating members.

This summary of the June meeting shows more details that are not yet known:

1. There is a serious divergence within the Fed on the June resolution, and some officials who agreed to "pause interest rate hikes" originally preferred "rate hikes" (several of the 18 officials with and without voting rights may agree to rate hikes), which raises the possibility of further rate hikes by the Fed;

2. The reason given by officials in favor of raising interest rates is that the momentum of economic activity is stronger than previously expected, and there is little sign that inflation is falling back towards the 2% target (inflation stickiness will be high);

3. Most officials believe that leaving interest rates unchanged at the June meeting will give more time to assess economic progress;

4. Almost all officials said that further rate hikes may be appropriate, and most stressed that communication with the market after the meeting is essential to convey this message (which will be the focus of future Fed officials' speeches);

5. The minutes of this meeting mentioned recession three times (compared to four in February, three in March, and two in May). Fed researchers believe that the likelihood of avoiding a recession and falling into a mild recession are roughly equal.

At the June meeting of the Federal Reserve, the idea that "there will be two more rate hikes this year" caused a sensation. Last night, the minutes of the meeting revealed that "standing still in June is not the original intention of all officials" was also sensational.

This is the Fed firing a warning shot at the world.

Yesterday we mentioned in the "Preview of Fed Minutes" published in Global Markets Strategy (Issue 34): Major Events:

First, the minutes of this meeting will continue to be hawkish and remain as flexible as possible;

Second, the July rate hike is not inevitable, but it will definitely increase (the probability of a July rate hike will further increase after tonight). Without two consecutive meetings to raise rates, it would be difficult for the Fed to claim that the rate hike cycle is still in place.

It is expected that the impact of this minute on the market will be difficult to dissipate in the short term, and the probability of a 25 basis point rate hike by the Fed in July has been pushed to 88%.

After the minutes were released, New York Fed President Williams (the number three figure in the Fed) said that it was right to suspend interest rate hikes in June, but that further contraction is possible in the future. Williams has been a centrist (neither dovish nor hawkish) in the past, and that's what comes out of his mouth, and you can imagine what Fed officials will say in the future.

This note has had a greater impact on the market than in the past:

- U.S. stocks fell across the board, but not much. The Dow fell 0.4%, the S&P 500 fell 0.2%, and the NASDAQ fell 0.2%;

- The dollar index rose 0.2%, higher against all major currencies;

- U.S. Treasuries and gold fell together, and gold fell nearly $20 from its high;

- The offshore yuan tumbled 0.5% to 7.2622 (2023 high of 7.2857);

- Bitcoin fell by 1.06% and Ethereum by 1.64%.

For the market, the important thing is not how much it has gone up or how much it has fallen, but a return to the past trading logic of "the dollar rises, everything falls".

Yesterday we predicted the trend of gold prices:

Calculated high: 1935; Actual high: 1934

Calculated low: 1914; Actual lowest price: 1914

Not only a bit of bit prediction, but also a specific trading plan. The "1933-1935 area can be laid out with short orders, the target is looking at 1915" strategy recommended in the "Golden Strategy" released at 7:00 on the same day can make a perfect appearance.

Today we have released the latest edition of Top Gold Strategies, which will be released by 7:00 am each trading day, and will continue to be updated until July 13 (next Thursday).