Hey guys, this is the last full trading week in May, and many forward-looking individuals like myself are already preparing themselves to seize whatever opportunities June may have in store. On this note, I will review a few commodities that have satisfied my quest for swing-trading opportunities in the coming month. Follow me!
How Will FOMC Meeting Affect the Markets
2023-03-23 • Updated
As expected, the Federal Reserve hiked the key US interest rate by 25 basis points for the second straight time during its two-day meeting ending March 22. The unanimous decision of the FOMC came amid major central banks' commitment to fighting inflation while maintaining economic growth. The decision coincides with turmoil in banking stocks due to the Credit Suisse and SVB crises. What is the technical outlook to all these? Please continue reading below.
The US Dollar (DXY) on the Daily timeframe has arrived at the Demand zone with an initial reaction away from the zone. However, I expect that price will return to the area before we see the major bullish impulse play out; the reason for this is the obvious gap created by the drop. Based on this analysis, a stronger Dollar would mean a bearish move on most major pairs.
EURUSD is my favorite setup from today's analysis. Here we see the price reacting to the 76% Fibonacci retracement level and a supply zone overlapping the area. There is also a trendline pivot, which acts as resistance in this case. Despite the Moving Average alignments, I believe this setup will do quite well based on the correlation with the US Dollar's analysis.
GBPUSD is currently trading within a channel and has reached the resistance trendline of the channel. The same area also has the confluences from the 88% Fibonacci retracement zone and the rally-base-drop supply zone. 1.21650 is my initial target for this trade.
XAUUSD - Weekly Timeframe
Similar to EURUSD, we're seeing a reaction of price to the 88% of the Fibonacci retracement and a retest of trendline resistance. There is also a note-worthy rally-base-drop supply zone and a gap around the $1873 area. These are my confluences in favor of a bearish trade from this area.
The trading of CFDs comes at a risk. Thus, to succeed, you have to manage risks properly. To avoid costly mistakes while you look to trade these opportunities, be sure to do your due diligence and manage your risk appropriately.
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The Bank of England (BoE) has dramatically shifted its economic forecasts. They no longer expect a recession in the UK and have upgraded their growth projections. This year, the BoE predicts GDP growth of +0.25%, a significant improvement from previous expectations. Next year's forecast is even more optimistic, with a projected growth of 0.75%.
Here's the scoop: The Bank of England (BOE) is set to accelerate the pace at which it shrinks its balance sheet, according to one of its deputy governors. Currently, the BOE is unwinding about £20 billion of quantitative easing every three months. The goal is to reduce the stock by around £80 billion per year through active sales and maturing assets.
Let's dive into the latest developments shaping the global economic landscape. Good news first: the threat of an unprecedented US debt crisis has receded, as US lawmakers passed a bill to raise the debt ceiling and avoid a catastrophic default. Phew! But don't pop the champagne just yet, because storm clouds are still looming. High inflation, rising interest rates, and sluggish growth are challenges that have yet to disappear.
Thanks to the incredible advancements in horizontal drilling and fracking technology, the United States has experienced a mind-blowing shale revolution. They've become the heavyweight champion of crude oil production, leaving Saudi Arabia and Russia in the dust. They even turned the tables and became net exporters of refined petroleum products in 2011.
Let's dive into the world of gold. Currently, the price of gold, represented by XAUUSD, is stuck in indecision, hovering around the $1,975 mark. The market is anxiously awaiting two important factors: the release of the Federal Reserve's meeting minutes and the extension of the US debt ceiling.