It was a game-changing week for equities last week. Fed chief Jerome Powell's commentary walloped the market that inflation was not tamed, rates would continue to rise, and peak interest rates may be higher than the market is forecasting. The news caused the market to sell off more than 200 points and create the largest red candle in months. The signal is that S&P 500 stocks are unlikely to move any higher this year and that downward risk is increasing. The last several candles like this led to further declines from 5% to 10%.

This week will be another hurdle for the market. The CPI data is due out on Tuesday and is expected to be hot. Another hot read of inflation data will keep the Fed on track to raise rates at least another 100 basis points; the next hike could be 50. The Fed needs to get the market's attention; its only weapon is interest rates.