Traders should be prepared for increased volatility with the Federal Reserve’s first policy decision of 2024 coming up. While no change in interest rates is expected, the Fed could adjust its monetary policy guidance which could trigger large swings. If the central bank embraces a more dovish posture, the U.S. dollar will fall. In the event of a hawkish signal and pushing back against expectations of deep and early rate cuts, the dollar should rise sharply.
The Fed’s interest rate decision will be announced at 19:00 GMT today, followed by the press conference 30 minutes later.
EUR/USD: Watch out for breaks either below 1.0790 (short) or above 1.0910 (long).
GBP/USD: Today, we will pay attention to a rise above 1.2760 which could attract buyers or a fall below 1.2640 that could increase bearish momentum towards 1.26 and further 1.2550.
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Our trading ideas for the FOMC decision 31/1/24:
Long @ 1.0860
Short @ 1.0785
Long @ 1.2710
Short @ 1.2665
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.
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