After Fed Focus Turns To ECB

The Federal Reserve hiked interest rates as expected but did not strike a hawkish tone. The U.S. dollar weakened amid the lack of commitment to further tightening.

The euro flirted with the 1.11 handle but trading was limited to a tight price range without major breakouts. The focus now turns to the European Central Bank’s decision today at 13:15 UTC.

The ECB is expected to raise rates by 25bp but traders speculate on a shift in a dovish direction in the face of the deteriorating health of the EU-economy. If traders begin to price out the probability of more tightening in September, the euro could experience a sharp sell-off.

However, from a technical view we see chances for further leg-up towards 1.12. On the downside, if the euro falls back below 1.1020, the next support lies at 1.0970.

Summer doldrums: We advise traders not invest too much or doing a trading break since volatility typically remains at very muted levels during the summer months of July and August. When volatility is low, there is more to lose than to gain.

Daily Forex and DAX Signals:

If you are keen to know where we put Take-Profit and Stop-Loss, if we trade on a specific day or not and how we manage open positions, subscribe to our signals.

Disclaimer: All trading ideas and expressions of opinion made in the articles are the personal opinion and assumption of MaiMarFX traders. They are not meant to be a solicitation or recommendation to buy or sell a specific financial instrument.

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2023 MaiMarFX.

Follow us on social media: