eToro – Forex Trading Forum

[BlueinGreen]

hi all,

this morning we are witnessing some AUD weakness, after the Reserve Bank of Australia kept rates on hold at 7.5% and suggested there might be some cuts on the way.
On the other side the Japanese Yen is advancing against many major pairs as investors’ worries over bad growth prospects in world economies, drive them to buy back the yen.

The EURUSD is traded very close to its support area at 1.5513, the break down could lead the way to 1.54, However, any substantial move before the Fed’s meeting today might be erased quickly if the result of the meeting would not supported that move.

Basically we are waiting to see what the Federal Reserve has to say about its future prospects on interest rates. Notice that the market is expecting the Fed to leave rates unchanged at 2% this meeting, so this fact alone is already priced in the market right now. What we want to hear is some hawkish remarks over fighting inflation and dollar weakness ( hawkish = like a hawk = aggressive ).

Any prospect for a rate raise later this year might steam the dollar up, but do not expect the statement to clearly say so, look for the subtext and read between the lines until you understand in which direction things are going. Do not try to base your decision only on the market’s move during the meeting, since the volatility alone can shake you off pretty quickly.


Events today (in GMT )

9:30am GBP Manufacturing Production m/m Forecast :0.1% Previous -0.5%

9:30am GBP Services PMI Forecast 46.7 Previous 47.1

3:00pm USD ISM Non-Manufacturing Composite Forecast 48.6 Previous 48.2

7:15pm USD FOMC Statement

7:15pm USD Federal Funds Rate Forecast 2% Previous 2%


Happy trading