Tonight, Fed Chairman Powell's speech will be the focus of the market. Based on the current economic situation, we can foresee three possible scenarios:

First of all, Powell may explicitly release a signal for a rate cut in September. In this case, the market will directly benefit and is expected to trigger a wave of rebound. However, the likelihood of this happening is relatively low, estimated at about 20%.

Secondly, it is more likely that Powell will indicate that the current timing is not suitable for interest rate cuts, but suggest a tendency for rate cuts in the future. This subtle position will also have a positive impact on the market, with a probability of about 50%.

Finally, Powell may not mention interest rate cut expectations at all and may even reinforce a hawkish stance. In this case, the market may face a new round of downward pressure, with the probability of this situation being about 30%.

In the face of these possibilities, investors should adopt a rational response strategy. It is recommended to take a wait-and-see approach, considering averaging down in the spot market, while exercising caution in the contract market, suggesting only short-term trading with quick in-and-out transactions. Investors should closely monitor changes in the situation and wait for clear market reversal signals.