2023-02-14 • Updated
The first FOMC meeting comes after a buildup of anticipation from traders and investors alike, as the markets await what posture the Fed will take regarding the interest rates; would there be a hike or a cut in interest rates? Recall that the Federal Open Market Committee had previously ended the year 2022 with a 50bps hike, and an indication from Powell, the committee chairman, that the Fed could consider raising interest rates by 75bps in the course of the year 2023.
The interest rates provide insights into the strength of the US Dollar, which helps traders and investors manage their expectations from the currency. Increased rates often lead to increased strength for the Dollar.
In light of the fundamental breakdown above, we will draw our conclusions from the outlook of price on the charts using price action.
The US Dollar on the Daily timeframe has made an initial reaction off the Daily Pivot as predicted in my previous articles. The reaction seems to have even broken above a miniature trendline resistance, giving us further confidence in the possibility of a bullish price action toward the 50-Day Moving Average as the very least target.
Analyst’s Expectations:
Direction: Bullish
Target: 104
Invalidation: 101.7
EURUSD has already begun the reaction from the daily pivot and the trendline resistance. As far as I can see, however, price seems to be heading towards the demand zone as marked since it was the "order block" right before price broke the previous high with a bullish FVG (Fair Value Gap).
Analysts’ Expectation:
Direction: Bearish
Target: 1.06500
Invalidation: 1.09201
The chart above shows the price action on the daily timeframe of the GBPUSD pair, and similar to what we saw on the EURUSD daily chart, price here is also reacting from an area of resistance. The major clause here, however, is that the reaction is a tad more sluggish than I would have loved to see. The 200-Day moving average could be the next target in view as I expect price to seek out a strong area of support in order to continue its bullish march.
Analyst’s Expectations:
Direction: Bearish
Target: 1.20624
Invalidation: 1.24539
From the Daily pivot zone, XAUUSD has played out a 300-pip bearish reaction. The point of the reaction aligned perfectly with the trendline resistance of the rising channel, indicating the likelihood that price bounces off the trendline support of the same channel to continue its bullish rally... possibly.
Analyst’s Expectations:
Direction: Bearish
Target: 1887.8
Invalidation: 1945
After the bearish break of structure, APPLE stock returned to the rally-base-drop supply zone that prompted the break of structure in the first place. On returning to the supply zone for a retest, price encountered the trendline resistance and was kicked down from that area of confluence. This leads me to expect a brief continuation of that bearish movement to the demand zone I marked below as the primary target.
Analyst’s Expectations:
Direction: Bearish
Target: $137
Invalidation: $148
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.
You can access more of such trade ideas and prompt market updates on the telegram channel.
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The Australian Dollar (AUD) rebounds on Monday, despite a slight dip in the US Dollar (USD) and higher US Treasury yields. Investors are eyeing Australian monthly Consumer Price Index (CPI) data for February and US Gross Domestic Product (GDP) for Q4 2023. The AUD gains momentum as the ASX 200 Index rises, especially in mining and energy sectors. Additionally, the Aussie...
Gold prices rose on Monday as the US Dollar weakened amidst speculation about potential Federal Reserve rate cuts starting in June. This weakened Dollar was partly due to improved risk sentiment pushing US Treasury yields lower. Despite facing challenges from declining yields, gold prices recovered to nearly $2,170 per troy ounce, driven by the Dollar's weakness. Federal Reserve Chair...
Jerome H. Powell, the Federal Reserve chair, stated that the central bank can afford to be patient in deciding when to cut interest rates, citing easing inflation and stable economic growth. Powell emphasized the Fed's independence from political influences, particularly relevant as the election season nears. The Fed had raised interest rates to 5.3 ...
Hello again my friends, it’s time for another episode of “What to Trade,” this time, for the month of April. As usual, I present to you some of my most anticipated trade ideas for the month of April, according to my technical analysis style. I therefore encourage you to do your due diligence, as always, and manage your risks appropriately.
Bearish scenario: Sell below 1.0820 / 1.0841... Bullish scenario: Buy above 1.0827...
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