Preview into the FOMC meeting

Preview into the FOMC meeting

Pay attention: the FOMC meeting is today at 21:00 MT time

Why is it so important?

No changes to the interest rate are expected. The Fed will publish the statement, which will contain the commentary about the economic conditions, discuss the economic outlook and offer clues on the future path of the monetary policy.  

The recent comments by policymakers on a rate cut later this year increased worries in the market.

 In addition, various inflation measures dropped below the 2% target and raised concerns over the rate cut even more.

What to watch?

  • If the dovish scenario is confirmed, we may see the revision of the inflation forecasts to the downside.
  • Also, we expect the shift in dot plot to the expectations of one rate cut by the end of the year.

As the dovish expectations are already priced in, any hawkish comments by the Fed Chair Jerome Powell will bring positive momentum to the USD. On the other hand, strong dovish tone of the statement will weaken the greenback.

EUR/USD

On the H1, the pair has been awaiting the FOMC meeting. It has been trading between the resistance at 1.12 and 1.1188 since the beginning of the trading day. Hawkish surprise from the Fed may pull the pair below the 1.1188 level. The next levels in focus for bears lie at 1.1177, 1.1162 and 1.1147. If the USD weakens today, bulls will break the resistance at 1.12 and target the next levels at 1.1211, 1.1222 and 1.1242.

USD/JPY

On the same timeframe, the USD rose against the JPY at the beginning of the day but was not able to stick near the 100-hour SMA. At the moment of writing, the pair has been moving towards the support at 108.35. The next support levels are placed at 108.28 and 108.24. On the other hand, bulls keep their eyes on the resistance level at 108.44. If it is broken, the pair will rise further where it will face the 108.49 and 108.53 levels as resistances.

Similar

Latest news

Evergreen buck heads north

On Friday, the evergreen buck rallied versus its counterparts after data disclosed that the American economy generated more jobs than anticipated In October, thus backing the Fed’s case to proceed with gradual rate lifts…

Gold ascends on Brexit jitters

On Tuesday, gold rallied because uncertainty over the latest developments in Britain’s departure from the EU backed safe haven demand and traders looked ahead for American inflation data to underpin the Fed’s pledge to remain on hold…

Deposit with your local payment systems

Callback

A manager will call you shortly.

Change number

Your request is accepted.

A manager will call you shortly.

Internal error. Please try again later

Beginner Forex book

Beginner Forex book will guide you through the world of trading.

The most important things to start trading
Enter your e-mail, and we will send you a free Beginner Forex book

Thank you!

We've emailed a special link to your e-mail.
Click the link to confirm your address and get Beginner Forex book for free.

You are using an older version of your browser.

Update it to the latest version or try another one for a safer, more comfortable and productive trading experience.

Safari Chrome Firefox Opera