The Euro is edging lower ahead of the FOMC decision as equity markets fall on profit taking. The FOMC rate decision could guide the Dollars near term direction. The Federal Open Market Committee will maintain the target range for the federal funds rate unchanged at 0.00% to 0.25%, while it continues to anticipate that economic conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period.
dbfx_smalladAlthough the FED’s fund rate will remain unchanged, investors are looking at the accompanying statement. Markets expect the FED will upgrade their economic outlook, maintain its $1.75T asset purchase program, and possibly give insight into an exit strategy.
Given the growing concerns over inflation in the future, the FED may try to taper off these concerns and signal to the markets it will act in light of the evolving economic outlook and conditions in financial markets.
Markets will focus mainly in comments regarding the purchases of Treasury securities, the pace of these transactions and the length of the program, which the full amount is anticipated to be purchased by the end of October. Lastly, investors will look for any adjustment made to its credit and liquidity programs and the the size and composition of its balance sheet.
Looking at the 4hour chart, EUR/USD rallied to the 1.4841 level post-NZD’s GDP but quickly reversed courses on strong supply. Traders are locking in some profits ahead of the FED’s meeting but are expected to build up positions at lower levels, subject to the meeting.
The Bias is neutral in the near term, however, preferred strategy remains to buy on dips. EUR/USD is also nearing strong resistance levels on the Daily Chart that could add the case for a corrective move to the 1.45s. Initial resistance can be found at 1.4821, followed by stronger levels at 1.4840, 1.4890 and 1.4950.
Should the pair retreat further, the Euro could retest the 23.6% Fib at 1.4687 and the 38.2% Fib at 1.4593 from the move 1.4189-1.4841. The 50.0% Fib lies at 1.4516.
Trading levels in play:
Recommend to stay on the sidelines ahead of the FOMC decision but start looking at buying opportunities if prices drop post-meeting. Key supports 1.4654, 1.4615, and 1.4562. Investors may add to their positions and anticipate tomorrows German Ifo release. Data is expected to rise to 92.0, following a 90.5.
(use half position size) Risky Limit Sell @ 1.4890 Targets: T1 1.4800 – T2 1.4472 Risk: 1.4990
* Good till NY Close. After 15 pips profit move stop to entry, take profit at will. Trade is canceled if it rebounds near entry and moves higher by 20 pips. Comments will follow if outlook changes.
ACKNOWLEDGEMENT: This article was done by ForexDistrict... so all kudos goes to them. and the publisher.
DISCLAIMER: Trading off-exchange currencies on margin carries a high level of risk, and may not be suitable for all investors. Before deciding to trade the foreign exchange, you should carefully consider your investment objectives, level of experience, and risk appetite. Before making your investment decisions please acknowledge that the information provided herein should not be taken without your own individual assessment and extensive investigation, it should not be preempted as your own trading strategies, investment advice and/or trading portfolio. The views, forecasts and strategies may not prove to be accurate and may not be appropriate for you.
ForexTechniq provides this section only for general information; please contact an expert professional if any of these advices are needed. Th
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Forex Broker - Deciding which Forex Broker to choose?
For you to trade Forex, you need to get a Broker just like trading Stock. Forex is somehow a free for all market and for that reason there are numerous Forex Brokers available each with diverse levee of reliability and service. So the best thing a Forex Trader should do is to choose the right Forex Broker for himself.
Truthful & Trustworthy
Before you pick any Forex broker, make sure you study their company and background as comprehensively as you possibly can. Some good signs of a reliable Forex broker are the length of the time they have been in operation and if they are a member of any financial regulating bodies found in various countries that currently try to regulate the Forex market. You need to find a broker that you are comfortable with and not need to worry about them closing up shop without warning.
Leverage
One of the attractions of trading Forex is that traders can use leverage. Leverage in the Forex market allows you to buy a standard lot without requiring you to have $100, 000 of the base currency. You are only required to have a predefined percentage of the full amount in your trading account. This allows traders to gain enormous profits with just a small amount of capital. Just how much leverage brokers offer varies?
The amount of leverage offered is usually broker dependent and can also depend on the lot size in which you are trading. Generally brokers will offer leverage at rates of either 50:1, 100:1 or 200:1, if however you have a restricted mini account some brokers will offer up to 400:1 leverage.
Spend some time researching brokers before you make the final decision to open a live account and begin trading Forex. Doing so may pay off in the long run.
Read more...
Truthful & Trustworthy
Before you pick any Forex broker, make sure you study their company and background as comprehensively as you possibly can. Some good signs of a reliable Forex broker are the length of the time they have been in operation and if they are a member of any financial regulating bodies found in various countries that currently try to regulate the Forex market. You need to find a broker that you are comfortable with and not need to worry about them closing up shop without warning.
Leverage
One of the attractions of trading Forex is that traders can use leverage. Leverage in the Forex market allows you to buy a standard lot without requiring you to have $100, 000 of the base currency. You are only required to have a predefined percentage of the full amount in your trading account. This allows traders to gain enormous profits with just a small amount of capital. Just how much leverage brokers offer varies?
The amount of leverage offered is usually broker dependent and can also depend on the lot size in which you are trading. Generally brokers will offer leverage at rates of either 50:1, 100:1 or 200:1, if however you have a restricted mini account some brokers will offer up to 400:1 leverage.
Spend some time researching brokers before you make the final decision to open a live account and begin trading Forex. Doing so may pay off in the long run.
Read more...
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