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Four Major Events

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Today, the Federal Reserve will announce its latest interest-rate decision. A 75-bp hike is considered a sure thing. Traders are rather looking for hints about plans to ease back from the Fed’s aggressive pace of hikes. Possible signals about a less-hawkish stance would be dollar-negative. However, given the hotter than expected September U.S. inflation report and the strong September nonfarm payrolls, the most likely scenario is continued aggressive policy tightening – at least until the end of 2022.

On Friday, the October U.S. jobs report will provide an important look at the health of the labor market.

On November 8, the U.S. mid-term elections could lead to a change in which party controls Congress. Stock bulls are hoping for a divided Congress, which has historically benefited equities.

On November 10, economists will be watching the consumer price index for signs of a further pullback in order to shape expectations for the Fed’s path. A lower reading could be dollar-negative on the back of increased risk appetite.

After an extended trading break, we have been back at the trading desk for three weeks now and have already been able to make a few profits. From 7 November 2022, we will also be offering our signals service again for all interested traders.

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Steht der Zinserhöhungszyklus der Fed vor seinem Höhepunkt?

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Willkommen zu einer neuen Handelswoche und unserer letzten vor der Sommerpause.

Das meistbeachtete Risikoevent ist die FOMC-Zinsentscheidung am Mittwoch, bei der erwartet wird, dass der Fed-Vorsitzende Jerome Powell und seine Kollegen die Zinssätze um weitere 75 Basispunkte anheben werden, nachdem sie sie bereits im Juni um 75 Basispunkte erhöht hatten. Powell sagte nach der letzten Zinserhöhung der Fed um 75 Basispunkte, dass es sich um eine ungewöhnlich große Anhebung handele und er nicht erwarte, dass Zinserhöhungen in dieser Größenordnung üblich seien. Der Markt befasst sich nun jedoch mit der Debatte über eine Anhebung um 75 oder 100 Basispunkte und der Reaktion des US-Dollars darauf. Nach Ansicht von Wirtschaftsexperten besteht zu keinem Zeitpunkt in diesem Zinszyklus Appetit auf eine Anhebung um einen ganzen Punkt.

Aus saisonaler Sicht sind in der letzten Juliwoche die Volatilität und das Volumen traditionell geringer, weshalb außergewöhnliche große Marktbewegungen diese Woche ausbleiben könnten.

Mit Blick auf die Zukunft prognostiziert eine Umfrage unter 44 Ökonomen, dass die Fed die Zinsen Anfang 2023 um weitere 25 Basispunkte anheben und einen Höchststand von 3,75 % erreichen wird, bevor sie eine Pause einlegt und vor Ende des Jahres mit Zinssenkungen beginnt.

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Der Inhalt des Beitrags spiegelt die persönliche Meinung des Autors wider. Dieser übernimmt für die Richtigkeit und Vollständigkeit keine Verantwortung und schließt jegliche Regressansprüche aus. Dieser Beitrag stellt keine Kauf- oder Verkaufsempfehlung dar.

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Thanksgiving-Woche mit Blick auf Trends

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Es ist Thanksgiving-Feiertagswoche in den USA und obwohl dies saisonal eine Verminderung der Liquidität an den Märkten bedeutet, heißt es nicht gleichbedeutend, dass es in dieser Woche keinen Trend geben wird. Steigende Covid-Fälle und die Geldpolitik bleiben die treibenden Themen und der Markt wartet auf die Entscheidung von U.S. Präsident Biden über den nächsten Chef der Federal Reserve. Die Entscheidung scheint zwischen Jerome Powell und Lael Brainard zu fallen. Letztere ist deutlich dovischer als Powell und eine Entscheidung zugunsten von Brainard könnte daher eine bärische Reaktion im U.S. Dollar auslösen. Die Märkte erwarten allerdings weitgehend, dass Amtsinhaber Powell seine Rolle beibehält und preisen sogar schon eine Zinserhöhung der Fed im Juli ein. Bidens Entscheidung, wer der nächste Fed-Vorsitzende sein wird, wird vor dem Thanksgiving-Feiertag am Donnerstag erwartet.

EUR/USD – Anfällig für einen Dip bis 1.1150?

Der Euro gibt der Warnung vor neuen wirtschaftlichen Stilllegungen im Zusammenhang mit wieder steigenden Covid-Fällen in Europa nach. Wir sahen das Paar bei 1.1250 eine kurzfristige Unterstützung findend, jedoch erwarten wir den Euro anfällig für weitere Verluste, da Deutschland die Tür für mögliche Lockdowns in der Weihnachtszeit offenlässt.

Aus technischer Sicht werden wir uns auf einen Bruch unter 1.1240 konzentrieren, um dann den Blick auf ein tieferes Ziel bei 1.1150 zu richten. Auf der Oberseite sehen wir einen kurzfristigen Widerstandsbereich zwischen 1.13 und 1.1330, der Verkäufer anziehen könnte.

GBP/USD – Könnten die Bären die Kontrolle übernehmen?

Während es Sterling Bullen gelang das Paar oberhalb von 1.34 zu stabilisieren, könnte sich die Stimmung nun zugunsten der Bären wandeln – vorausgesetzt die 1.34-Schwelle bricht. Unterhalb von 1.3390 richten wir unseren Fokus auf ein tieferes Ziel bei 1.33. Nichtsdestotrotz sollten Trader berücksichtigen, dass das Britische Pfund von einer „Buy-the dip“ Strategie profitieren könnte im Vorfeld der Bank von England Zinsentscheidung im Dezember, bei der eine erhöhte Wahrscheinlichkeit für eine Zinserhöhung besteht. Dies ist jedenfalls das, was der Markt einpreist.

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Der Inhalt des Beitrags spiegelt die persönliche Meinung des Autors wider. Dieser übernimmt für die Richtigkeit und Vollständigkeit keine Verantwortung und schließt jegliche Regressansprüche aus. Dieser Beitrag stellt keine Kauf- oder Verkaufsempfehlung dar.

Copyright © 2021 MaiMarFX.

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Traders Eye ECB Decision And U.S. Inflation

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Both EUR/USD and GBP/USD have been trading in tight price ranges given the onset of the summer lull, making it difficult for traders to profit from low volatile swings. Even technical price breakouts provided little follow-through as volatility ebbs. However, today might be different with traders eyeing the U.S. key inflation report and European Central Bank decision for clues on the direction of monetary policies. We brace for bigger market moves around the ECB decision at 11:45 UTC and the inflation report due at 12:30 UTC.

As for the inflation report, expectations are that even a little higher reading won’t change the Fed’s monetary policy path right now. Fed policy makers are in a wait-and-see mode and do not intend to surprise the market with premature policy changes at their meeting next week. If there is, however, a significant higher inflation reading, taper talk is about to intensify with the U.S. dollar soaring ahead of the Fed meeting.

The ECB is likely to follow the Fed’s lead and keep ultra-loose monetary stimulus in place. Neither the Fed nor the ECB is expected to slow the pandemic bond buying at their meetings this month. Economists expect policy makers to opt for another three months of the very accommodative monetary policy. Central banks could taper bond-buying in September at the earliest.

In a nutshell, while we do not expect fireworks today, we brace for higher volatility that could provide profitable trading opportunities.

EUR/USD: Bulls were unable to stabilize the pair above 1.22 ahead of today’s risk events. We will keep tabs on a significant break above 1.2250 in order to expect further gains. Above 1.2270, the next higher target is 1.2350. On the downside, if the euro breaks below 1.2130 and further 1.2090, we could see accelerated bearish momentum towards 1.1950.

GBP/USD: After the cable failed to hold above 1.42 the focus shifts to a break below 1.4090 that could lead to further losses towards 1.40. On the upside and following a renewed break above 1.42, a higher target is seen at 1.4280. How the pair will trade in short-term time frames could however mainly hinge on the greenback’s performance today.

We wish you good trades!

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No Surprises At The Fed’s Meeting?

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The U.S. dollar started this week on a weaker note against other major currencies and Wednesday’s Federal Reserve policy assessment, which has held firm against hawkish expectations could even increase the pressure on the greenback, at least in the short-term. The Fed is expected to keep interest rates near zero and signal no change in their monthly bond purchases at Wednesday’s meeting. Fed Chair Jerome Powell has primed market participants to fear no surprises, so could it thus be a non-event for traders? Maybe, since policy makers refrained from providing further guidance on the conditions which would warrant a tapering of the central bank’s quantitative easing. However, speculative positioning could spur some volatility in USD crosses around the time of the Fed’s press conference.

On Thursday traders will watch U.S. GDP data which is forecast to show a 6 percent growth in the first quarter.

Let’s take a brief look at the technical picture:

EUR/USD

We currently see the pair breaking above 1.2110, the descending trend line, which could lead to further gains towards 1.2170 and 1.22. Bears, on the other side, may watch out for a break below 1.2030 that could result in a test of lower support levels at 1.1950 and 1.19. However, as long as the euro trades above 1.20, the short-term outlook remains bullish.

GBP/USD

The technical picture has not fundamentally changed with the cable remaining in a 200-pip range between 1.40 and 1.38. The outlook remains however bullish – provided the pair holds above 1.3770. An upside break above 1.40 would open the door to further gains towards 1.41 and 1.4250.

We wish you good trades!

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The Fed is Unlikely to Surprise the Market

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The British pound rose to a high of 1.3750 against the U.S. dollar and analysts predict that sterling will continue to outperform against other peers. One of the reasons for the pound’s strength is the vaccine rollout in the U.K. which is going better than almost anywhere else. While vaccine rollouts elsewhere are lagging, Britain has immunized around five times as many people as a proportion of its population than the European Union. Pound traders bet on a sterling comeback on the back of optimism that the economy will find its footing faster than other peers. Some analysts even predict that the pound could advance 20 percent against the euro.

Looking at the GBP/USD chart, chances are in favor of further bullish momentum with a higher target at 1.3850. For bearish momentum to gain traction we would need to see the pound declining again below 1.3630.

The EUR/USD remained trading within a relatively narrow price range between 1.2176 and 1.2107. We will now focus on price breakouts either above 1.2220 or below 1.2115 that could reinvigorate fresh momentum.

Today the focus turns to the Federal Reserve policy decision and Fed Chair Jerome Powell is expected to strike a cautious tone when it comes to curbing the Fed’s massive asset purchases, even though the economic outlook has brightened further thanks to the expected big budgetary boost from U.S. President Joe Biden. Even if some market participants may hope for a change in the Fed’s ultra-dovish policy stance, the most likely scenario is that the central bank maintains the current guidance indicating that monetary policy will remain ultra-loose for at least another year.

In other words, we do not expect any surprises at today’s decision but if the Fed sends a relatively more hawkish message, the U.S. dollar will strengthen in response.

We wish you good trades!

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Quiet Trading

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Dear Traders,

U.S. inflation data came in line with expectations whereupon the dollar gave up some of its gains. However, the greenback had a rather mixed day while it ended yesterday’s trading day virtually unchanged against the euro and British pound.

Generally speaking, it seems that many market participants refrain from taking any larger positions now amidst the liquidity drain during the summer months. Therefore, we recommend to trade at a low risk or stay at the sidelines as long as risk events are lacking.

The Fed will deliver its monetary policy report to Congress today at 15:00 UTC.

We wish you a wonderful weekend.

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We wish you good trades and many pips!

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Copyright © All Rights Reserved 2018 Maimar-FX.

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U.S. Dollar Continues Slide After Trump State Of The Union Speech

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Dear Traders,

Turn-around Tuesday lived up to its name and we got what we were looking for: A reversal of the dollar’s short-lived recovery and a very good daily and monthly profit. The U.S. dollar is being sucked into the maelstrom triggered by the ‘America First’ agenda of the Trump administration. As for the depreciation of the greenback and the long-term outlook, we can point out that the protectionism move will negatively influence the world’s largest economy.

The dollar extended its slide after U.S. President Trump’s State of the Union speech. As expected, Trump sought to strike a positive tone and described a “New American Moment” of wealth and opportunity. Trump called on Congress to pass a 1.5 trillion infrastructure-spending plan but this campaign promise was widely expected by the markets. Thus, the dollar’s reaction to his speech was muted.

EUR/USD

The euro recovered some of its losses after the 1.2330-support proved intact. Now that the single currency has stabilized above 1.24 we could see another test of 1.2450, a short-term resistance in the EUR/USD. If the euro finds its way above 1.2460 we expect further gains towards 1.25 and possibly even 1.2650.

The British pound started a relief rally after the psychological support at 1.40 has been tested. If the pound climbs above 1.4210 we may see a rise towards 1.43 but this depends on the risk appetite and demand for dollars ahead of the FOMC decision.

The next upcoming risk event will be the FOMC rate decision at 19:00 UTC but no changes are expected. It will be Janet Yellen’s last FOMC meeting before her term ends in February.

Before coming to the FOMC decision, we will keep an eye on the Eurozone Consumer Price report, due at 10:00 UTC, followed by the ADP report at 13:15 UTC.

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We wish you good trades and many pips!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2018 Maimar-FX.

www.maimar.co

 

There Is No Reasonable Explanation For The Dollar’s reversal

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Dear Traders,

It seemed as if dollar bulls just sought an excuse for taking profits on dollar positions after the U.S. dollar rose to new highs on evidence of firming inflation. Whereas for the U.S. all signs are pointing to higher inflation and thus, higher interest rates and a stronger dollar, there was no reasonable explanation for the sharp reversal of the USD towards the end of the trading day. During the House Financial Services Committee hearing, conservatives Republicans pressed Fed Chair Janet Yellen to concede that economic growth is still disappointing and that the Fed has failed to fix underlying problems. For the most part, Yellen’s tone was positive, defending the Fed’s efforts that had contributed to strong job growth. The only negative point during the hearing was that Yellen acknowledged that economic growth has been “quite disappointing”. This seemed to be the reason for the weakening dollar in short-term time frames.

The EUR/USD traded higher, heading towards 1.0630 and it will now be interesting whether the 1.0660-resistance is going to hold. If the euro breaks through 1.0665/70 we expect accelerated bullish momentum towards 1.0710 and possibly even 1.0750. A current support area is however seen at 1.0580-60. If the euro falls back below 1.0560 it could extend its losses towards 1.0510.

The pound sterling ended the trading day virtually unchanged against the greenback. A break above 1.2520 could boost bullish momentum but we bear in mind that the barrier at 1.2550 is still unbroken. Crucial support levels are seen at 1.2350 and 1.2310 and as long as the pound remains firmly above these zones we will rather focus on higher price levels.

There are no major economic reports scheduled for release today and those of you who have already made a good profit this week, shall better not reinvest their profits.

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We wish you good trades and many pips!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2017 Maimar-FX.

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USD Receives Boost On Hawkish Yellen Comments

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Dear Traders,

The U.S. dollar was bolstered by hawkish comments from Fed Chair Janet Yellen on the first day of her testimony. While Yellen did not reveal much new information, she was surprisingly hawkish, saying that “waiting too long to remove accommodation would be unwise, potentially requiring the FOMC to eventually raise rates rapidly, which could risk disrupting financial markets”. In other words, the pace of interest rate hikes could accelerate, still leaving the door open for a hike in March. Market participants will now shift their focus to the U.S. Consumer Price data with the intention to evaluate the need for faster rate normalization.

The greenback traded higher against the euro and British pound and while we generally expect further gains in the dollar, traders should also prepare for some pullbacks in short-term time frames.

The euro found some halt at 1.0560 and it may now tend to correct recent losses towards 1.0615 and possibly even 1.0630. Today’s price action will, however, again hinge on the demand for dollars. In case of better-than-expected CPI data the euro could extend its losses towards 1.0540 and 1.05.

The British pound dropped towards 1.2440 after the U.K. Consumer Price Index failed to meet market expectations. Signs of weaker price growth may encourage the Bank of England to maintain a neutral monetary policy. From a technical perspective, the cable is still confined within a sideways trading range between 1.2550/85 and 1.2440. A break below 1.2440 may prompt sterling bears to sell sterling towards 1.2350 and further 1.2270. On the topside, the pound will need to break through 1.2530 and 1.2560 in order to invigorate fresh bullish momentum.

We will keep an eye on the U.K. Labor Market report, due for release at 9:30 UTC, which could affect the price action in the GBP/USD, provided that there is any surprise.

Higher volatility is expected during the U.S. session with Consumer Prices and Advance Retail Sales scheduled for release at 13:30 UTC.

Fed Chair Yellen will testify before the House Financial Services Committee at 15:00 UTC.

Daily Forex signals:

Additional daily and long-term entries are available for subscribers.

View our daily signal alerts https://www.maimar.co/category/daily-signals/

Subscribe to our daily signal service https://www.maimar.co/signals/

We wish you good trades and many pips!

Any and all liability of the author is excluded.

Copyright © All Rights Reserved 2017 Maimar-FX.

www.maimar.co