|Day's Range||0.009 - 0.009|
|52 Week Range||0.0087 - 0.0095|
Today the USD will be faced with the major news and report- the FOMC Federal Funds rate decision. Besides the official rate announcement, the report includes the FOMC’s projection for inflation and economic growth over the next two years and, a breakdown of individual FOMC member’s interest rate forecasts.
The pair reversed its direction and broke down significantly during the Tuesday’s session reaching the 1.2275 level, an area which is a significant support level. If Fed moves forward with 3 rate hikes this year, then the market will resume its upward movement towards the 1.43 and 1.45 level. The AUD traded on a choppy note throughout the Tuesday’s session dancing just above its major support level at 0.77 level.
The U.S Federal Reserve will release its Monetary Policy Statement later today. Gold has languished near support and has proven unable to march upwards in a sustained manner.
Investors are most likely to react to any hints offered by the Fed about whether the central bank will stay on track for three rate hikes in 2018 or if it expects to be more aggressive by forecasting four rate hikes.
The US dollar rallied a bit during the trading session on Tuesday, as traders await the announcement coming from the Federal Reserve today, and more importantly the statement that goes along with the announcement.
Investors will also be looking for clues from the central bank on its outlook for the U.S. economy and how many interest rate increases we may see to prevent the economy from overheating.
The U.S Dollar has been weaker in forex as the Euro and Pound lost value. The Yen has been weaker versus the U.S Dollar.
A transition deal between the U.K and E.U took forex by surprise yesterday. Wall Street stumbled badly on Monday and the NASDAQ led losers.
The pair shot higher slamming the 1.2325 level during the Monday’s session, the area which has been a bit noisy and supportive in the past. Because of this, it will experience difficulty in crossing above and once it clears above then it should move higher reaching the 1.24 and 1.25 level eventually. The market has also some downside risk if the Fed sounds out to be more hawkish in respect to the rate hike in its next meet. …Read MoreGBP/USD
Japan is on bank holiday and the U.S. has no reports so we could see thin market conditions that are likely to add to current elevated volatility levels.
The US dollar was noisy against the Japanese yen on Monday, rallying towards the 106.50 level. This is an area that should continue to be important, so at this point, although it looks as if we are trying to form a base, I think the market is still working hard to determine where it goes next. With the Federal Reserve meetings this week, expect a lot of noise.
Watch the price action and read the order flow at 106.440 all week. Trader reaction to this level will tell us if the buying or the selling is getting stronger.
The Euro reversed earlier losses on Monday after investors revived bets that the ECB may raise rates sooner than previously thought.
This week is going to be very busy for the dollar, the leading event being Fed meeting, the very first one for its new governor Jerome Powell. A key interest rate is extremely likely to be raised during the meeting, the investors and analysts say, but this is not the major question here. The markets will be expecting any comments or hints regarding future policies and steps the Fed is going to take.
The pair broke down significantly during the Friday’s session reacting to the stronger than expected Industrial Production figures from US reported month over month. If the pair succeeds to break above the 107.50 level, then it will change the course of this market and will go towards the 110 level next.
If the focus remains on Fed policy and this week’s upcoming interest rate decision, monetary policy statement and economic projections then prices should remain stable today.
The U.S Dollar remains strong versus the Euro and Pound. However, the Yen has been gaining as the political crisis surrounding Prime Minister Abe grows in scope.
Investors will also continue to monitor the turmoil in the White House and a possible announcement of tariffs against China. These events have the potential to create volatility which could drive up demand for the safe haven Japanese Yen.
The Dollar/Yen was pressured last week by political uncertainty in U.S. President Donald Trump’s cabinet and renewed worries about trade wars.
The US dollar initially tried to rally against the Japanese yen during the week but found the 107.50 level to be resistive. We turned around from there, and then fell towards the uptrend line yet again. At this point, the uptrend line is holding, but there is a lot to pay attention to in this pair.
The pair drifted a little lower during the Thursday’s session reaching the 1.23 level which is a strong support level. If the pair breaks below further from here, then it will reach further lower towards the 100 level.
Based on the current price at 105.924 and the earlier price action, the direction of the USD/JPY the rest of the session is likely to be determined by trader reaction to the short-term Fibonacci level at 106.023.