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GBP/USD edges lower, BoE's Bailey says no to rate cutsThe British pound has edged lower on Wednesday. In the North American session, GBP/USD is trading at 1.2287, down 0.10%. There are no tier-1 releases out of the UK or the US today, leaving investors to focus on comments from Bank of England Governor Bailey earlier in the day. The Bank of England kept rates on hold for a second straight time last week at 5.25%, the highest level in 15 years. Investors were keen to hear from Governor Bailey who spoke today in Ireland. Bailey sounded hawkish, reiterating that rates would have to remain "restrictive for an extended period" in order to bring inflation back down to the 2% target. Bailey said that the BoE is projecting that inflation will fall back to target in about two years. Will the BoE cut rates anytime soon? Bailey flat-out rejected the idea, stating that "it's really too early to be talking about cutting rates". However, BoE Chief Economist Huw Phill appeared to contradict his boss, saying on Monday that a cut in August 2024 "doesn't seem unreasonable". Phill noted that too restrictive a policy could create a recession and push inflation below target.  The discussion over rate cuts may be hypothetical at present, but rates will have to come down eventually and BoE policy makers are likely to have differences of opinions on the matter. In the US, Fed Chair Powell made public remarks earlier today but did not address monetary policy. Fed Reserve Governor Michelle Bowman said on Tuesday that the Fed may need to raise rates if inflation falls too slowly. Bowman said that the Fed has made progress on the inflation front but it remains too high, with services inflation remaining stubborn and the risk of higher energy prices. The markets have priced in a rate cut as early as May, with the odds of a rate cut of at least 0.25% rising to 51%, up from 40% a week ago, according to the CME Group's FedWatch tool. There is resistance at 1.2348 and 1.2476 GBP/USD tested support at 1.2287 earlier. Below, there is support at 1.2183
by OANDA
EUR/USD Dynamics & Market FactorsEUR/USD Pair: The EUR/USD pair is trading within a tight range around the 1.0700 level during the Asian session, lacking a clear intraday direction. US Treasury Bond Yields and Equities: A recent significant pullback in US Treasury bond yields and a rally in US equity markets have not provided support for the US Dollar, traditionally considered a safe-haven asset, contributing to a favorable environment for the EUR/USD pair. Federal Reserve Rate Hike Path: Uncertainty surrounds the future path of interest rate hikes by the Federal Reserve. Recent indications from the Fed that financial conditions may already be tight enough to control inflation have led to the perception that the Fed might pause its interest rate hike campaign. US Monthly Jobs Report: The less robust US monthly jobs report released on Friday has reinforced the notion that the Federal Reserve is likely to maintain its current policy stance for the third consecutive time in December. Hawkish Fed Officials: Some Federal Reserve officials have adopted an assertive tone and recognized the resilience of the US economy. German Industrial Production: Tuesday's data revealed a more significant decline than expected in German industrial production in September, which could weigh on the Euro and restrict the potential upside for the EUR/USD pair. European Central Bank (ECB) Rate Hikes: Expectations suggest that further rate hikes by the European Central Bank (ECB) may not be on the agenda, indicating a bearish outlook for the Euro. Market Drivers: The release of the final German Consumer Price Index (CPI) and Eurozone Retail Sales data, along with US bond yields and overall market sentiment, will influence the US Dollar and potentially create short-term trading opportunities for the EUR/USD pair.
Long
by Forex48_TradingAcademy
3
GBP/USD Upward Movement to 1.25!On Tuesday, the GBP/USD exchange rate faced renewed downward pressure, falling towards the 1.2250 level. This decline was driven by the ongoing recovery of the US Dollar, supported by rising Treasury yields, despite positive movements in Wall Street. The GBP/USD exchange rate was last seen trading near 1.2300, where it encountered a key resistance zone marked by the 38.2% Fibonacci retracement level from the latest downward trend and the 20-period Simple Moving Average (SMA) on the 4-hour chart. If the exchange rate falls below this level and confirms it as resistance, we may witness further losses towards 1.2260 (static level) and 1.2200 (23.6% Fibonacci retracement level and the 50-period SMA). During Tuesday's European session, the GBP/USD exchange rate faced pressure and dropped into the 1.2300 region. The short-term technical outlook for the exchange rate suggests a bearish stance. In the absence of significant data releases, market sentiment and risk perception could play a crucial role in GBP/USD performance in the second half of the day. After reaching its highest level since mid-September at 1.2428 on Monday, the GBP/USD exchange rate reversed direction and closed in negative territory. The rebound in US Treasury bond yields increased demand for the US Dollar (USD) and prevented the exchange rate from holding onto previous gains. Earlier in the day, UK house price data revealed a 1.1% monthly increase in October, but this publication did not trigger a significant market reaction. Furthermore, the price retraced precisely to the 0.62 Fibonacci level, and now I personally expect a rebound to 1.23, where we have a supply zone, followed by a slight pullback and then a rise to 1.25. Let me know what you think. Happy trading to all, greetings from Nicola, the CEO of Forex48 Trading Academy.
Long
by Forex48_TradingAcademy
8
TONCOIN - Top 10 Crypto Market Cap PotentialTon Targets - Support and Resistance Zones. Support Zone: $2.275 Resistance Zone 1: $2.55 - $2.65 Target 1: $2.80 Previous Top Resistance Zone: $3.01 - $3.35 Potential Bull Run Target 1: $4.85 Toncoin (TON) is a layer-1 blockchain that emerged back in 2018 from the creators of the secure messaging app Telegram. The project underwent a transformation after being handed over to the TON Foundation, leading to a name change from "Telegram Open Network" to "The Open Network." Since 2020, the tech has seen progress thanks to a group of enthusiasts working without commercial interests, forming the TON Foundation. Toncoin, previously called Gram, serves as the native cryptocurrency on the TON network. Originally, the plan was to integrate TON into a user-friendly app enabling fund transactions for users. Users pay fees and employ TON for transaction validation and payments. The Toncoin network relies on the proof-of-stake (PoS) consensus model to ensure scalability and dependability. As per the project's website, the platform offers swift, transparent, and secure payment services, making transactions cost-effective and eliminating the need for third-party apps.
Long
by Helios_Capital_Investment
ES: Fed Pivot Breathes Life into MarketsCME: E-Mini S&P 500 Options ( CME_MINI:ES1! ) Last Wednesday, investors cheered as the Fed kept interest rates unchanged for the second time in a row. On Friday, a soft jobs report backed up market expectations that the rate-hiking campaign is over. For the full week, the Dow was up by 5.07% in its best week since October 2022. The S&P was higher by 5.85% and the Nasdaq gained 6.61%. It was the best week for both indexes since November 2022. Investors Choose to Ignore What the Fed Says Stock market behavior shows that the Fed is still the dominant driver. Drilling down further, I find that what moves market is not the actual Fed action, but the expectation of what the Fed would do next. Very often, such market-moving expectations could be in direct contradiction of the Fed Chair’s public statement. At the post-FOMC press conference, the Fed Chair said that they had not made a decision for the next meeting. He also stated that pausing now would not prevent the Fed from raising rates again. The Fed Chair stressed that they had not discussed if or when to cut rates. The overarching focus now is to bring inflation down to the 2% target rate. Investors think otherwise. According to CME FedWatch Tool, the probability of keeping rates unchanged on the December 13th FOMC is 95.4% as of November 5th. By the FOMC meeting scheduled on May 1st, 2024, the odds for cutting rates by 25-50 bps are 71%. (Link: www.cmegroup.com) Investors acted upon their expectations. Prior to the Fed meeting, Treasury yields were rising sharply. 10Y rose from 4.5% to above 5.0% in 11 days. In the three days following the rate decision, 10Y took a nosedive and now back to 4.6%. This dramatic changes in yields took place while the Fed did nothing. The stock market rebound could be attributed to the change in expectations too. Lowering rates has the effect of raising the present value of future cash flows, thus increasing a company’s market value, as prescribed by the Discounted Cash Flow valuation method. The collapse of the US dollar is due to the expectations that it would not generate higher returns without further rate increases, according to interest-rate parity theory. Let’s look at two more examples: On July 26th, the Fed raised rates by 25 bps. This was the 11th consecutive rate hike. US stocks rose initially, with the major indexes going up 1-2%. Investors interpreted that this marked the end of Fed tightening. The expectations of Fed Pivot drove market higher, even though the Fed continued to stress the important for fighting inflation. The September 20th FOMC was the first Fed Pause. On face value, this should have been taken as a huge positive. However, investors believed that the Fed would raise rates one more time by year end. US stocks falls so much that both S&P and Nasdaq lost more than 10% from their high and entered contractionary territory. Trading with E-Mini S&P Options What’s the implication from the above observation? 1. Investors may have an easier time forecasting the Fed decision itself than the market reaction after worth. A 95% probability of a Fed Pause could not tell if the stock market would rise or fall after the decision is made. 2. Investor expectations could be adjusted very quickly. Following the Fed decision, the stock market could move up or down by 5% in a week. We could build an event-driven strategy focusing on the December 13th Fed meeting. If we think that the stock market would make a sizable move after the Fed decision, CME E-Mini S&P Options on Futures could be used to express this view. The trade would not be built by this single insight only. There are more: The November jobs report will be released on Friday, December 8th, and the November CPI data will be published on Tuesday, December 12th. These big reports, available to the Fed right before the FOMC, could have a major impact on its rate decision. More importantly, it could alter investor expectations and drive market volatility. The December 2023 contract (ESE3) will be expired on Friday, December 15th, two days after the FOMC. It is also the “Triple Witching Day”, where US stock index futures, stock index options, and single-stock options contracts all expire on the same trading day. My writeup from September shows that stock market is highly likely to make a big move on Triple Witching and on the days leading up to it. With big reports, Fed decision and Triple Witching all within one week, the stock market could enter wild swings as investors digest new data. Time is ripe for options traders. CME E-Mini S&P 500 Options provide leverage and capital efficiency. Options are based on futures contracts. Contract notional is $50 x S&P 500 Index. On the morning of November 6th, the December futures contract is quoted 4,384. The out-of-the-money (OTM) call strike 4,580 is the most active call options, with over 50,000 lots traded. If a trader purchases a call and it finishes at 100 points above the strike, she will realize a gain of $5,000 (=50 x 100), minus the upfront premium she paid. If the market moves against the trade, with the index value below the strike, she will lose money, up to but not beyond the upfront premium. The OTM put strike traded 1,023 lots. If the trader purchases a put and it finishes 100 points below strike, the trader will also make $5,000, minus the premium. If the market moves against the trade to finish above the put strike, the trader will lose money, up to but not beyond the upfront premium. Happy Trading. Disclaimers *Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services. CME Real-time Market Data help identify trading set-ups and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com
CME_MINI:ES1!Long
by JimHuangChicago
6
TradePlus-Fx|GOLD: calm💬 Description: Metals have stopped their rapid growth, which can most likely be associated with a “pause” in the Middle East. However, demand still remains and is likely to continue in the near future. Before this, you need to “cleanse” the market of unnecessary passengers, that is, buyers, who are actually fewer than sellers. The latter, in turn, try to enter at the very maximum and, instead of profit, catch stop-losses. Approximately the same scenario most likely awaits us after the price moves slightly lower to 1948.160. 🔔 FX CALENDAR TODAY 🔔 🇬🇧Manufacturing/Services/Composite PMI 🇪🇺ECB President Lagarde Speaks 🇺🇸Manufacturing/Services/Composite PMI 🇺🇸Richmond Manufacturing Index 🛢API Weekly Crude Oil Stock ➖➖➖➖➖➖➖ 🚀Thank for your BOOSTS 🚀 👇Share your views and FOLLOW US 👇
OANDA:XAUUSDLong
by TradePlus-Fx
24
XAU/USD Pullback to 1950 after NFP?The price of gold is consolidating just below the $2,000 level at the beginning of the week on Monday. This comes as the United States Dollar (USD) and US Treasury bond yields are attempting to find stability in a market environment that is inclined towards risk-friendly sentiment. Gold has faced challenges staying above the $2,000 threshold on multiple occasions last week, finding demand at lower levels. An immediate support is available at the rising trendline, situated at $1,975. If this support is breached, the November low at $1,9769 may be revisited. Failing to hold above this level could lead to a test of the static support at $1,960, potentially opening the path to the psychological level of $1,954. On the upside, breaking and maintaining above the $2,000 level is crucial to initiate a significant uptrend. A strong resistance barrier is present around the multi-month high of $2,009, coinciding with a horizontal resistance. The next significant level for Gold buyers is near the mid-May high, around $2,020. The Unemployment Rate increased to 3.9% compared to the expectation of 3.8%. Asian markets are following the positive closing on Wall Street from last Friday, buoyed by optimistic remarks made by China's Premier Li Qiang over the weekend. Li reaffirmed China's commitment to maintaining its pace of opening up and sharing development opportunities with the world. However, the US Dollar is seeing a minor rebound in Asia on Monday, benefiting from a slight uptick in US Treasury bond yields as investors adjust their positions for the new week. Additionally, during the Asian session, the price broke a swing high at the level of 1987.50, which is leading the price towards a pullback in the direction of around 1950, where there is a significant horizontal support/resistance zone. In that area, it will be important to evaluate possible upward movements and potential market entries at M15/M5, considering that macroeconomic data is scarce this week, and a calmer market could still reveal surprises. Comment and leave a like, have a great start to the trading week, everyone, and greetings from Nicola, CEO of Forex48 Trading Academy.
OANDA:XAUUSDLong
by Forex48_TradingAcademy
5
EUR/USD Pullback Expected Before a New Rally!EUR/USD has gained bullish momentum, surpassing the 1.0700 level for the first time since late September. The upward movement of the pair during the American session was driven by a US Dollar selloff triggered by a weaker-than-expected increase in October's Nonfarm Payrolls. The US Dollar (USD) selloff, which began after the Federal Reserve's monetary policy announcements on Wednesday, continued on Thursday. The USD weakened further against other currencies following disappointing data from the United States, revealing a 0.8% decline in Unit Labor Costs on a quarterly basis in the third quarter and an increase in weekly Initial Jobless Claims from 212,000 to 217,000. Market expectations for the US Nonfarm Payrolls (NFP) in October are an increase of 180,000, following the impressive gain of 336,000 in September. During the post-meeting press conference, Federal Reserve Chairman Jerome Powell emphasized that policy decisions would be based on a comprehensive analysis of data and risk assessment. According to the CME Group FedWatch Tool, the market is currently pricing in a 20% probability of one more rate increase in December. While a strong NFP reading may not significantly change these odds, it could provide an immediate boost to the US Dollar. Conversely, market positioning suggests that there is room for further weakness in the US Dollar if the NFP falls short of expectations, particularly if the report shows a figure at or below 150,000. Additionally, the price is currently within a supply zone between the 1.0690 and 1.0750 levels. At this level, the price may experience a pullback, especially after the bullish momentum led the market to break a swing high at the 1.0676 level. Therefore, I personally expect a retracement before continuing to move long towards the 1.10 level. Let me know what you think, leave a comment, and give a like. Greetings from Nicola, the CEO of Forex48 Trading Academy.
Long
by Forex48_TradingAcademy
7
SP500 pulled back by 100 points before heading towards 4500.On Friday, we witnessed a strong growth in the SP500 index, further bolstering its performance, with an increase of 0.94%. The day started with strength, opening 4,334.2 points above the previous session's highs, and quotations strengthened throughout the entire session. In fact, it has been an impressive week for the SP500, with the index rising by over 200 points (5%). More importantly, it has returned to a significant zone that has acted as both support and resistance in the past two years. From a technical perspective, touching this resistance could lead to a correction, and this drop could provide a good buying opportunity. I expect a price return to the level of 4290, which is a retest of the trendline, as the price is currently in an order block, a very important area where sellers will try to push the price down. Once the price reaches the 4290 area, it could potentially rise towards 4500, or the 0.705 Fibonacci level. Let me know what you think. Greetings from Nicola, the CEO of Forex48 Trading Academy.
CME_MINI:ES1!Long
by Forex48_TradingAcademy
3
US30 After the FED, 36,000 incoming!Regarding yesterday's trading day: Checked progress for the American index, which closed up by 0.66%. The start of the day was quite promising for the index, marking an initial price at 33,988.8 points, staying above the peaks from November 2nd and continuing to rise during the session. Currently, the short-term outlook for the Dow Jones indicates a strong ascent with a target set at 34,438.8. In case of a temporary correction, the immediate target is seen at 33,306.4. However, expectations are for the curve to rise further to reach the peak at 35,571.1. Resistance 2: 34,438.8 Resistance 1: 34,061.3 Support 1: 32,551.5 Support 2: 0.7642
BLACKBULL:US30Long
by Forex48_TradingAcademy
10
GOLD Pullback and then Target 2100.On Friday, the XAU/USD pair reached an intraday high of just under $2,005, in response to the disappointing US Nonfarm Payrolls (NFP) report, which marked the weakest performance in almost three years. However, Gold prices managed to recover to the midrange of the day's trading, ultimately closing near $1,992.50. The NFP report for the US fell short of expectations, revealing that the US added only 150 thousand jobs in October, a significant decline from the previous month's robust figure of 297 thousand job additions, which had already been revised downward from the initial estimate of 336K. Market expectations were initially set at 180K for the October reading. This headline miss led to a surge in global markets as investors welcomed the potential halt to Federal Reserve (Fed) interest rate hikes. Earlier in the week, Gold reached a weekly high of $2,008 but later dipped to a low of $1,970. Despite the disappointing NFP report, Gold faced challenges in securing substantial gains. This is due to the prevailing caution among investors regarding cooling US economic data. Inflation and excessive wage growth continue to be pivotal concerns for the Fed. Therefore, a single subpar NFP reading is unlikely to alter the Fed's stance on maintaining higher interest rates for an extended period. Currently, money markets are pricing in the likelihood of a full percentage point interest rate cut by the end of 2024, but this projection may be premature, given the Fed's efforts to manage price volatility. In the near term, Spot Gold bids indicate the formation of a rising channel, with XAU/USD trading on the positive side of the 200-hour Simple Moving Average (SMA), which is currently trending upward from $1,985. As shown on the chart, in the weekly timeframe, gold broke out of a bearish channel after bouncing in the 0.5 Fibonacci retracement zone. It is currently at the level of 1992 and may experience a pullback to around 1910 before resuming its upward move towards 2100. Let me know what you think, and I wish everyone a great weekend. Regards from Nicola, CEO of Forex48 Trading Academy.
OANDA:XAUUSDLong
by Forex48_TradingAcademy
5
GBP/USD Pullback expected before reaching 1.24Analysis of GBP/USD: The GBP/USD is on the rise towards the 1.2400 level to conclude a trading week that has seen the pair mostly fluctuate around the averages. After the US Nonfarm Payrolls (NFP) data came in well below expectations, the British Pound (GBP) has seen a 1.6% increase from Friday's opening bids near 1.2190, and the GBP/USD is up almost 2.5% from the week's lows of 1.2095. US Nonfarm Payrolls increased by 150,000 in October versus the forecast of 180,000. The US NFP figures fell short of expectations, marking the worst headline figure in nearly three years. The US added 150,000 new jobs in October, missing the market forecast of 180,000 and well below September's figure, which was revised downward from the initial print of 336,000. The failure to meet US employment targets is dragging the US Dollar (USD) lower across the market as investors shift towards risk assets, despite the deteriorating US labor data, which is counterintuitively inspiring investors to move out of safe havens. Weaker US economic data could lead the Federal Reserve (Fed) to reconsider interest rate decisions, as investors look for signs that the Fed may accelerate the program of potential rate cuts. Technical Outlook for GBP/USD: The Sterling's ascent driven by the NFP data is pushing the GBP/USD straight through the 50-day Simple Moving Average (SMA), aiming directly for the 1.2400 level and preparing to challenge the 200-day SMA, which is currently moving sideways from 1.2435. GBP/USD has recently oscillated between 1.2300 and 1.2100, and a bearish fallback would see the pair sliding towards multi-month lows around the 1.2000 major level. I personally expect a pullback to around 1.2160, where the price could then reverse to head towards 1.24. Let me know your thoughts, and happy trading to all from Nicola, the CEO of Forex48 Trading Academy.
Long
by Forex48_TradingAcademy
5
Boy that was a week!What a week that was! The dance around 150 certainly didn't disappoint. After the break and failure the week prior which continued on Monday, I thought that was it, that price gave it a good shot but ultimately failed, and would perhaps settle below. To nobodies surprise then when the BoJ held rates at -0.10% that we made almost a straight line move back above the once solid wall. So severe was the buying, I wouldn't have blamed anybody buying dips on Wednesday. The top was just over 151.700, and despite a small bounce on Thursday lunch, we spent the rest of the week grinding back towards 150. I don't think the Fed decision can really be to blame, it seemed almost certain we'd get a pause, in fact the market mostly agreed in the minutes after the release with a very muted reaction. Today's jobs numbers was a different story, seeing an 80 pip decline. The past 3 days have almost all but wiped out the BoJ fuelled push giving us a messy looking Daily chart which is no longer respecting the uptrend nor 150 in any meaningful capacity. Heading into next week i'll be watching to see where price settles. Give everybody the weekend to digest what happened and follow the price action Mon/Tue and let that inform an entry. Hope you all had a great trading week, and I'll see you in a couple days.
by RuckSack
XAUUSD heading towards 2100 - NFP and Middle East conflict!Nonfarm Payrolls (NFP) in the United States increased by 150,000 units in October, as reported by the Bureau of Labor Statistics (BLS) of the United States last Friday. This figure was below market expectations, which anticipated 180,000 new hires. The September increase, initially recorded at 336,000, was subsequently revised downward to 297,000. During the same period, the unemployment rate inched up from 3.8% to 3.9%, while the labor force participation rate declined from 62.8% to 62.7%. Annual wage inflation, measured by the change in average hourly wages, eased to 4.1% from 4.3%. In response to these data, the US Dollar faced significant downward pressure. At the time of writing, the US Dollar index was down 0.6% at 105.55. Evaluating the October employment report, FXStreet analyst Yohay Elam commented: "The data is weak enough to reduce the likelihood of a rate hike, cementing the end of the tightening cycle. This is unfavorable for the US Dollar. The data is neither too weak to push investors into the Greenback nor too cold to diminish profits. For stocks, it's the perfect situation: the economy is not too strong to drive rate hikes, nor too weak to reduce profits. As for gold, the decline in Treasury yields is an advantage, but events in the Middle East are also being observed. Additionally, in the case of gold, an important level at 2010 is noted, which, if breached, could push the price toward 2100. Also, pay attention to the support zone at the 1998 level. Let me know what you think, comment, and leave a like. I wish everyone successful trading, greetings from Nicola, the CEO of Forex48 Trading Academy.
OANDA:XAUUSDLong
by Forex48_TradingAcademy
4
USD/CAD steady ahead of Canada, US job reportsThe Canadian dollar is showing little movement on Friday. In the European session, USD/CAD is trading at 1.3740, up 0.03%. The week wraps up with US and Canadian employment reports, which could mean volatility from the Canadian dollar during the North American session. The US releases nonfarm payrolls, which had a massive September and crushed expectations with a gain of 336,000. The markets are projecting a modest gain for October, with a market consensus of 170,000. The ADP Employment Change report, which isn’t considered a reliable gauge for nonfarm payrolls but is still closely watched, posted a weak gain of 113,000 in October, well below the market consensus of 150,000 and following the September reading of 89,000. Will nonfarm payrolls follow suit or will we see another hot release? The US dollar has declined against the majors since the Federal Reserve's decision to maintain interest rates for a second straight time. Fed Chair Powell tried to sound hawkish and reiterated that rate hikes remain on the table, but the markets are in a dovish mood and believe that rates may have peaked. If the nonfarm employment release follows ADP and misses expectations, it would likely mean the end of the current tightening cycle and I would expect the US dollar to decline after the release. Conversely, a strong non-farm payrolls report would support the Fed's stance that rate hikes remain on the table and would likely translate into strong gains for the US dollar following the release. The Fed will also be keeping an eye on wage growth, a driver of inflation. Wages rose 0.2% m/m in September and the market estimate for October stands at 0.3%. On an annualized basis, wage growth is expected to ease to 4.0% in October, down from 4.2% in September. Canada's employment is projected to ease to 22,500 in October, compared to 63,800 in September, which marked an eight-month high. The labour market has remained strong despite the Bank of Canada's aggressive tightening, and a weak employment reading would boost the case for another pause from the BoC and could weigh on the Canadian dollar. 1.3730 is a weak support level. Below, there is support at 1.3660 There is resistance at 1.3805 and 1.3950
by OANDA
GBPUSD: Rejection from trendline, supported by fundamentals?As we can see price has is currently respecting the descending trendline again. I'm expecting the BoE to maintain their hike-pause stance, this result is already baked into the price... I'm placing a small trade on the basis that my expectations will be correct... If there's a pause or reduction (highly unlikely) I'm expecting a fall back to around 1.208 to continue the creation of the wedge, important not to be greedy here as I feel like we could break out of the wedge at anytime, so probably will be considering buys once this trade is closed and keep a close eye on PA in the LTF's. Let's see what the BoE do!
Short
by Finchcliffe
5
British pound gets lift as Fed and BoE pausesThe British pound has posted strong gains on Thursday. In the European session, GBP/USD is trading at 1.2216, up 0.54%. Bank of England pauses The Bank of England voted to maintain interest rates at 5.25% at today's meeting. The pauses follow 14 straight rate increases in the current tightening cycle which began in December 2021. The move indicates that the MPC is sticking to the "Table Mountain" approach, which is essentially a "higher for longer" stance that keeps rates at elevated levels until the BoE is confident that inflation will fall back to the 2% target. The MPC vote was 6-3, with the majority favoring a pause and three members voting to hike rates by a quarter-point. At the September meeting, the vote to pause was 5-4. The division within the MPC indicates that members remain divided over policy, which will make it difficult for Governor Bailey to present a clear path moving forward. The BoE revised inflation projections slightly higher and the statement noted that the BoE stood ready to raise rates if it sees "more persistent inflationary pressures". The markets are hoping that the back-to-back pauses mark the end of the current rate-tightening cycle, but rate cuts aren't expected until late in 2024. Governor Bailey said after the meeting that higher interest rates had pushed inflation lower but it was "much too early to be thinking about rate cuts." US dollar dips after Fed pause The Federal Reserve held rates for a second straight time on Wednesday. The Fed reiterated that rate hikes remained on the table, but acknowledged that "tighter financial and credit conditions" were weighing on inflation. This was likely a reference to the recent rise in US Treasuries, which has increased borrowing costs and could push inflation lower without the Fed having to raise rates. If Powell was trying to sound hawkish, the markets weren't buying it. Future markets have priced in another pause in December and expectations are that the Fed is done with hiking, despite Powell's assertion to the contrary. The US dollar is down against all of the majors and US stock markets were strongly higher on Wednesday. . GBP/USD Technical GBP/USD is testing resistance at 1.2175. Above, there is resistance at 1.2251 There is support at 1.2068 and 1.2032
by OANDA
No such thing as a Hawkish pause? USD overrated? Has the market adopted the term “hawkish pause” to bolster USD bids? It could be possible that, in an attempt to drag out USD strength just a little bit longer (euro has weakened –4.20% in past 6 months), the term Hawkish Pause has been thrown around with not-enough criticism. Not many people have confidence in the US Fed to really make the hard decisions (transitory inflation anyone?), including being able to start up the rate hiking engine again (this year or next) after a few pauses. If they do, will they do it in a timely manner? Jerome Powell, this morning noted in his public address that the committee hasn’t discussed what it might plan for its December decision but dismissed the idea that it would be difficult to start hiking again (if the conditions in the market require such an action). There are two more inflation readings and two more labor market readings before the last decision of the year. Maybe investors have shrugged off the hawkish pause rhetoric this morning though. The Australian dollar is pumping, up 0.94% at last look, while the dollar has fallen more than half a percent against the yen. The euro is only up 0.16%.
by BlackBull_Markets
EUR/USD extends losses, Fed meeting loomsThe euro is in negative territory on Wednesday after posting a losing session a day earlier. In the North American session, EUR/USD is trading at 1.0532, down 0.40%. The Federal Reserve makes its interest rate announcement later today and the markets have fully priced in rate pause, which would keep the benchmark rate at 5.25%-5.50%. Although the decision is practically a given, investors will be looking for signals as to what the Fed plans to do next. Fed Chair Powell has been hawkish about inflation and I wouldn't be surprised if he reiterated the same message at today's meeting. On the employment front, JOLTS Job Openings rose to 9.55 million in September, up from a revised 9.49 million in August and above the market consensus of 9.25 million. This was the highest level in four months, another sign that the labour market remains strong. The US releases nonfarm payrolls on Friday, with the banner gain of 336,000 last month still fresh in investors' minds. The market consensus for September stands at 180,000. Germany's economy has sputtered, and the once proud locomotive of European growth is looking more like the sick man of Europe. The manufacturing sector has been exceptionally weak and has posted three successive readings below the 40 level. A reading below 50 points to contraction, while above 50 signals expansion. Germany will release the Manufacturing PMI on Thursday. The market consensus for October stands at 40.7, which would be a slight improvement from the September gain of 39.6. There is resistance at 1.0595 and 1.0664 1.0495 and 1.0426 are providing support
by OANDA
DXY index ahead of the Federal Reserve Perhaps this week's turnaround in the DXY correction is in its infancy? DXY index ahead of the Federal Reserve certainly looks poised for further gains in line with the recent break of this week's highs and off today's support in the closing price of yesterday. Fundamentals are aligned bullish also. The risk to the Dollar would be on a dovish interpretation of the statement and Powell. Some may argue that a 'buy the fact and sell the rumour' outcome could be the case.
TVC:DXY
by Ross-J-Burland
Should I do a FOMC strangle/ straddle play? Read here.So, what's the best way to play FOMC? Probably a strangle. According to last FOMC on 9/20 your NASDAQ:QQQ calls would have printed around +50% or more. Assuming you sold and held your puts, your puts would have given you an extra 200% to 300%. You can do this on any stock obviously. Don't get greedy. Best decision might be to stay out of course. Choosing a definite direction (i.e. holding calls/ puts only without a hedge) is pure gambling. Good luck. Welcome to follow for trade ideas. FOMC chart 9/20:
NASDAQ:QQQ
by kingdips