The EUR/USD pair is making gains, approaching multi-month highs around 1.0960, driven by a weakened USD and Christine Lagarde's somewhat hawkish remarks before the European Parliament. Minor housing data from the U.S., specifically New Home Sales for October, came in below expectations but didn't significantly impact the pair. Lagarde, President of the...
Central Banks Pause Rates. Markets Await NFP
2023-11-03 • Updated
The Federal Reserve decided unanimously to maintain interest rates at 5.25-5.50%, a highly anticipated move that retains significant implications for monetary policy's future course. Despite this decision, the FOMC refrained from definitively ruling out potential future rate hikes, leaving room for policy adjustments. During his press conference, Chair Jerome Powell expressed deep concerns about ongoing inflation, implying that the current policy might not be restrictive enough. Rising bond yields also captured the Fed's attention, contributing to tightening financial conditions.
On the other side of the Atlantic, the Bank of England (BOE) took a similar stance by holding existing interest rates, following a series of consecutive rate hikes from December 2021 to August 2022. The UK grapples with high inflation, which surged to 6.7% in September, significantly exceeding the BOE's 2% target, similar to the US and Europe. Core inflation, excluding volatile food and energy prices, remains uncomfortably high at 6.1% for the UK. The country maintains a 15-year high interest rate of 5.25%, and it remains to be seen how this would impact the NFP release.
USDCAD - H4 Timeframe
USDCAD began a steady decline a short while ago, and the drop is currently approaching a demand zone. When price reaches the demand zone, I expect to see a bullish rally because the demand zone overlaps with other confluences like; the 200-period moving average, trendline support, and the bullish array of the moving averages indicating a bullish trend is at play.
EURUSD - H4 Timeframe
At this time, we can see the price action on the 4-Hour timeframe of the EURUSD chart returning to the previous high where we have a supply zone. My expectation is that the bullish move will be rejected from the supply zone, back to the 50-period moving average.
GBPUSD - H4 Timeframe
GBPUSD’s 4-Hour timeframe chart provides a much cleaner price action compared to the EURUSD chart of the same period. Here on GBPUSD we see the supply zone clearly at the 76% of the Fibonacci retracement as the price action slowly approaches it. The bearish moving average array is also quite clear.
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Canada's forthcoming Consumer Price Index (CPI) data, set for release on Tuesday, is projected to show a year-on-year decline in inflation to 3.2% for October from the previous 3.8%. This potential inflation dip might offer leeway for the Bank of Canada (BoC) to maintain its overnight rate target at 5.0% in the...
Speculation persists regarding the Bank of Japan's potential departure from negative interest rates, yet the USD/JPY maintains its position within a 150–152 range for seven consecutive sessions. Caution is warranted due to a weaker-than-expected Q3 GDP, a slump in imports, and...
Bitcoin's price remains stagnant despite the Fed's slightly less hawkish tone. In contrast, Bitcoin has outperformed other assets, doubling in price from $16K to nearly $38K this year. Improved fundamentals, including the resolution of Binance concerns...
Hey folks, it’s a wrap to yet another month in the 2023 calendar, and I’m guessing you know what that means - time for another episode in the “What To Trade” series. For December, I will be mapping out trade more cautiously as the market volatility often drops
Gold prices, reaching the highest since May 5, are consolidating as traders await the US PCE Price Index, a key inflation indicator. The upcoming data could impact the Fed's policy, influencing the demand for the US Dollar and providing direction for gold. The Greenback sees some repositioning, recovering modestly ahead of the data risk.