The FOMC meeting is scheduled for 2:00 pm EST today as the USD is stronger on the day. The stock market remains uncertain as volatility picks up hours before the meeting. We are going to hear sentiment towards monetary policy and thoughts on rate hikes going forward after the latest 50 bp hike.
It is important to listen to what they discuss regarding interest rates and what it would take for them to loosen their grip on such tight policy. If the Fed mentions a concern for the slowing of the economy, then they might take measures to let up on the aggressive hikes.
Additionally, the Fed's aggressive 50 bp hike on May 4 might have been enough for them to decide on a less aggressive stance. A problem we are facing now is the economy and jobs data. The US has missed several weeks of expectations in unemployment claims. Claims have climbed up to 218,000 from 184K a month ago.
Listening to economic projections is going to be another important thing to do. Judging by the past several weeks, projections may be weak in the short term. At least, this is what I'm expecting them to say. A major concern lies within a possible recession due to a slowing jobs market and higher costs causing less spending. Regardless, there might not be
USDJPY came down to the 50 DMA for potential support and is beginning a bounce as investors eye the upcoming FOMC news. Support lies right below around 125.025. If policy continues its aggressive stance towards interest rates, we may find more upside for the pair.
USDCAD is coming off resistance from a falling trend line on the 1D timeframe. Overall trend is still upward, but looks like price is rejecting off today's highs. Increased volatility today could make technicals irrelevant for a little while. Additional support could be below around the 50 and 200 DMA.
GU looks increasingly bullish as today's candle pushes higher today. We might see some higher highs on the day, but it is still likely that the USD will regain strength after the FOMC statements. A tighter policy seems more likely now, so more downside looks to be what's in store for this pair.
As this week comes to a close, we are looking ahead at future setups that could be some of the best opportunities for the next several trading sessions. Here are some pairs for next week that we are looking at. EUR/JPY Recent data has shown a slow down in the German manufacturing sector. With European […]
When it comes to testimonies, it's all in how you say it. Jerome Powell has to be very particular in the way he makes his statements and answers the ensuing questions. Here is what might be in store for the market in the coming days and weeks, and whether or not there will be more […]
The historically 'safe' currency to hold in times of recessions is in a unique situation now with a couple factors in place. Here is why the yen is stronger today as well as some trade setups that could push its value either up or down. Weaker Yen Now, Stronger Yen Later The Bank of Japan […]
