New York Fed President Bill Dudley speaks at 8:30 am ET (1230 GMT) on Monday

NY Fed President Dudley has slowly edged toward the very dovish camp over the past year. He's been skeptical about global growth and inflation. So far he's been right.

He's a core member of the FOMC so if/when he shifts to a more constructive view on the economy and inflation, it may signal that the time to hike is near.

The FOMC statement was interpreted as dovish and rate hike expectations were pushed into January but on Thursday Yellen may have aimed to scale that back with a more-optimistic speech in Boston.

That's left the market a bit confused about the true possibility of an October hike. At the moment, the Fed funds futures market is pricing in only an 18% chance of a hike on Oct 28.

Late last week, typical Fed hawks like Lacker, Bullard and George were talking about hikes but those are similar types of things to what they've been saying for the past two years. If a centrist-dove like Dudley were to hint that it's a bigger possibility, then it's a true sign that the Fed is ready to move.

The great part about this appearance is that Dudley will be interviewed by WSJ Fedwatcher Jon Hilsenrath so he will certainly be grilled on the timing and direction of rate hikes. Note also that the August PCE report will be released at the same time so it will make for some choppy trading.

What will happen if he's hawkish

I noted on Friday that CFTC positioning showed US dollar net longs are the lowest in more than a year. If sounds like he's prepared to vote for a rate hike in October then there is plenty of room to the upside. Look to buy the US dollar against commodity currencies if so. Another trade would be selling gold. Fast money has poured into the precious metal since the Fed and it could quickly head to the exits.

If he's dovish

It's always tougher for a dove to be surprising by being dovish so the risks are much lower. If he comes off as especially dovish it's further confirmation that hikes probably aren't coming this year. He might do this by preaching the wait-and-see rhetoric and downplaying inflation risks. If he goes beyond that, the US dollar is vulnerable.