The July FOMC today presents a great deal of two way risk for USD. With data improving firmly over the last month and with ongoing optimism around the current path of re-opening, upside expectations are building. USD has been broadly higher since the last FOMC meeting, reflecting a shift in positioning though the lack of momentum recently means there is plenty of room for the rally to become more explosive. On the other hand, given the built up expectations in the market, if the Fed disappoints there is plenty of room for USD to unravel with this meeting likely to set the tone for the summer’s trading.
Where to Trade The FOMC?
EURUSD
Price action in EURUSD recently looks poised for an upward break. If the Fed disappoints tonight and USD comes off, EURUSD stands in pole positioning to rally. Price has broken out of the falling wedge pattern and is now testing the 1.1840 level with RSI and MACD both bullish. A break above here will target 1.1961 initially.
Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.
Past performance is not indicative of future results.
High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 75% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Futures and Options: Trading futures and options on margin carries a high degree of risk and may result in losses exceeding your initial investment. These products are not suitable for all investors. Ensure you fully understand the risks and take appropriate care to manage your risk.
With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.