Coming Week: Batten the Hatches

More inflation data hits the market on Wednesday with the June CPI, which economists predict will rise by 0.2%, compared with 0.4% in May. The consensus estimate for the core CPI is an increase of 0.2% in June, after a 0.3% rise the prior month.

Housing starts for June also will hit the market Wednesday morning. Economists are looking for a rate of 1.915 million starts on an annualized basis, compared with 1.957 million in May.

Meanwhile, Bernanke will give his first semiannual monetary policy report to the Senate's committee on banking, housing and urban affairs.

"Obviously, the market will be hanging on to his every word for clues as to what the Fed will do in August," says Wachovia's Neuhart, who believes the Fed will pause at its August meeting. "We tend to think he will be dovish, but we've been burned by him before." Bernanke will be speaking to the House Committee on financial services on Thursday.

Leading indicators for June will be revealed on Thursday as well. The consensus estimate is for a rise of 0.1%, compared with a drop of 0.6% the prior month. The Philadelphia Fed survey is also on tap for Thursday, along with the minutes from the June FOMC meeting.