EUR/USD what to expect from Powell? effect on price direction?
Updated
Fed monetary policy update according to last FOMC >>
there was not a whole lot of agreement beyond that Fed COULD start reducing the pace of their bond-buying by the end of the year, now it is just about tweaking the timing, which is considered as not only USD positive but also insufficient information to the investors who are waiting for a clear calendar date to predict the dollar value accordingly.
In my previous post I mentioned the reasons why to expect volatility at 1.1700-1.1800, also I mentioned that the main catalyst to predict the breakout or the retest on the weekly chart is the further guidance on tapering asset purchases expected to be released by Fed on Friday (27/08/2021)
Here I will mention the two possible scenarios and how they can affect price action
1- Scenario ( 1 ) >> Fed announces the official date to start the process of tapering asset purchases, if the announcement and the action to be due end of year 2021 =
price range to be 1.1680-1.1790 .
no higher highs on the weekly frame (1.1800) .
to consolidate lower range before trying to break higher above 1.1750 or wait for further fundamentals to predict next moves .
2- Scenario ( 2 ) >> Fed announces the official date to start the process of tapering asset purchases, if the announcement and the action to be due early next year 2022 =
price range to be 1.1700-1.1850 .
to expect at least a retest on the weekly frame (1.1800) (low expected to break above 1.1820 only because of the EU weak calendar data) .
I can not say price would consolidate the upper range due to the weak EU data which is not motivating to hold long near the 1.1800 zone .
CONCLUSION
- Fed announces to start tapering asset purchases by end of year 2021 ( price to hold lower range, retest on the weekly frame expected ) -
- Fed announces to start tapering asset purchases early next year 2022 ( price to hold upper range, retest on the weekly frame, low expected higher high to be capped by 1.1850 ) -
- General price range according to recent fundamentals ahead of Fed announcements 1.1800-1.1700 -
- Current volatility is not perfect for swing traders, to predict position post monetary policy updated expected from Fed on 27/08/2021 -
- THIS OUTLOOK REMAINS ONLY TILL UPCOMING NEWS AND DATA THAT MAY CHANGE THE PRICE RANGE, SO I WILL UPDATE ACCORDINGLY -
there was not a whole lot of agreement beyond that Fed COULD start reducing the pace of their bond-buying by the end of the year, now it is just about tweaking the timing, which is considered as not only USD positive but also insufficient information to the investors who are waiting for a clear calendar date to predict the dollar value accordingly.
In my previous post I mentioned the reasons why to expect volatility at 1.1700-1.1800, also I mentioned that the main catalyst to predict the breakout or the retest on the weekly chart is the further guidance on tapering asset purchases expected to be released by Fed on Friday (27/08/2021)
Here I will mention the two possible scenarios and how they can affect price action
1- Scenario ( 1 ) >> Fed announces the official date to start the process of tapering asset purchases, if the announcement and the action to be due end of year 2021 =
price range to be 1.1680-1.1790 .
no higher highs on the weekly frame (1.1800) .
to consolidate lower range before trying to break higher above 1.1750 or wait for further fundamentals to predict next moves .
2- Scenario ( 2 ) >> Fed announces the official date to start the process of tapering asset purchases, if the announcement and the action to be due early next year 2022 =
price range to be 1.1700-1.1850 .
to expect at least a retest on the weekly frame (1.1800) (low expected to break above 1.1820 only because of the EU weak calendar data) .
I can not say price would consolidate the upper range due to the weak EU data which is not motivating to hold long near the 1.1800 zone .
CONCLUSION
- Fed announces to start tapering asset purchases by end of year 2021 ( price to hold lower range, retest on the weekly frame expected ) -
- Fed announces to start tapering asset purchases early next year 2022 ( price to hold upper range, retest on the weekly frame, low expected higher high to be capped by 1.1850 ) -
- General price range according to recent fundamentals ahead of Fed announcements 1.1800-1.1700 -
- Current volatility is not perfect for swing traders, to predict position post monetary policy updated expected from Fed on 27/08/2021 -
- THIS OUTLOOK REMAINS ONLY TILL UPCOMING NEWS AND DATA THAT MAY CHANGE THE PRICE RANGE, SO I WILL UPDATE ACCORDINGLY -
Note
Powell Says Taper Could Start in 2021, With No Rush on Rate Hike.Bullish View.
will explain new price range and reasons in next idea.
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