fxtalk

If you are wondering what was the volatility immediately after the Fed's announcement, here is a 1min chart:
As expected, the pair had crazy moves back and forth, and those with opened positions at 18:15 GMT who did not use a low leverage and a loose stop-loss are now licking their wounds.

As I said in my previous post, if the Feds choose not to match the market expectations for a stimulus, but to pump in just enough to give a clear message that the US economy is on the right track, this will create the conditions for a short-term appreciation on USD.

Right know this is the case: the Feds decided to keep the current rates unchanged, but they will stimulate the market injecting about $75 billion per month until June. This would mean that the market should expect a total of $800 - $900 from the Feds during the next month, which is less than it's expectations.


The clear message was that FOC "will continue to monitor the economic outlook and financial developments and will employ its policy tools as necessary to support the economic recovery and to help ensure that inflation, over time, is at levels consistent with its mandate.”

Today is a bug day for all USD based pairs, but the most affected pair will be EUR/USD.

After 28 higher highs and higher lows the pair seemed to end this rally and created some hope for a reversal.

Although, yesterday, the pair tested the 1.4050 barrier we still need to see a break above 1.4080 to negate my bearish outlook. If it will happen, the rally will target the 1.4400 -1.4500 position, with the possibility of breaking above it afterward.

As I said, I maintain my bearish outlook for now, but keep a close eye on EUR/USD. My advise would be not to open any position for now and way for the clear confirmation of a bearish or bullish movement.

FOMC is the major event for today and until it happens it is unlikely to see any major moves in currencies. What to expect from FOMC? Either a short term USD consolidation (which will confirm my bearish expectations, at least on the near future) or to see the USD remaining under pressure, which will give even chances for both bearish and bullish scenarios.

At this moment the markets are expecting a stimulus, and it's no doubt weather the Feds or inject or not. The question is how will they do it?

If the Feds choose to meet or pump in beyond market expectations the USD will remain under pressure and extreme care will be needed when opening new positions on EUR/USD.

If the Feds choose not to match the market expectations for a stimulus, but to pump in just enough to give a clear message that the US economy is on the right track, this will create the conditions for a short-term appreciation on USD.

All in all, I don't expect to see much move into the USD based currencies before the Feds Rate Decision announcement. My suggestion will be not to open any new positions up until the big announcement and, even afterward, keep a close eye on the pair movement. If you are already in the market, be prepared to close your position without profit and come back later when the market will give you clear signals.

Yesterday I was talking about RBA's intervention that created the premises for a bearish trend in the near future. Until now the currency has confirmed this outlook and is giving clear signals for opening short positions.

Yesterday I was advocating going short around 1.0000 with a stop-loss around 1.0150 and those who managed to open this position should be pleased now, since the currency is below 0.9980.

I maintain my bearish outlook for the next days, but those who want to open any position today, keep a close eye on the Feds Rate Decision event. I strongly suggest not to enter the market today unless there are obvious signals. Because of the FOCM event the trade might get choppy.

Today is a bug day for all USD based pairs, but the most affected pair will be EUR/USD.

After 28 higher highs and higher lows the pair seemed to end this rally and created some hope for a reversal.

Although, yesterday, the pair tested the 1.4050 barrier we still need to see a break above 1.4080 to negate my bearish outlook. If it will happen, the rally will target the 1.4400 -1.4500 position, with the possibility of breaking above it afterward.

As I said, I maintain my bearish outlook for now, but keep a close eye on EUR/USD. My advise would be not to open any position for now and way for the clear confirmation of a bearish or bullish movement.

FOMC is the major event for today and until it happens it is unlikely to see any major moves in currencies. What to expect from FOMC? Either a short term USD consolidation (which will confirm my bearish expectations, at least on the near future) or to see the USD remaining under pressure, which will give even chances for both bearish and bullish scenarios.

At this moment the markets are expecting a stimulus, and it's no doubt weather the Feds or inject or not. The question is how will they do it?

If the Feds choose to meet or pump in beyond market expectations the USD will remain under pressure and extreme care will be needed when opening new positions on EUR/USD.

If the Feds choose not to match the market expectations for a stimulus, but to pump in just enough to give a clear message that the US economy is on the right track, this will create the conditions for a short-term appreciation on USD.

All in all, I don't expect to see much move into the USD based currencies before the Feds Rate Decision announcement. My suggestion will be not to open any new positions up until the big announcement and, even afterward, keep a close eye on the pair movement. If you are already in the market, be prepared to close your position without profit and come back later when the market will give you clear signals.

After 28 higher highs and higher lows the pair seemed to end this rally and created some hope for a reversal. Over the last two weeks a head and shoulders formation started to create and most of us were expecting to see the confirmation for the much-awaited reversal.

Today EUR/USD broke the 1.4000 barrier and, even if some are still hoping into a reversal, the head and shoulder formations seems to fade away.

As in my last EUR/USD talk, I will still keep my bearish outlook, although the chances to see it's confirmation are really slim. A move above 1.4080 on a daily basis will create the premises for a new rally, resistance being around 1.4500.

Bear in mind that Feds rate decision is awaited for this week and this creates a major psychological impact over the market.

My suggestion is not to open any position right now and keep a close eye on EUR/USD on the next days until the new trend, bearish or bullish, is fully confirmed.

Keeping an eye on AUD/USD, GBP/USD, and USD/SGD yesterday payed off, the first two pairs offering a 30 to 50 pips move each which is not exactly bad taking into consideration that the market is currently consolidating, and more important moves are expected to after the Fed's Rate decision on Wednesday.

The Reserve Bank of Australia just offered us a bearish signal at about 3:00 AM GMT., when the Australian Dollar practically exploded. The intervention of RBA becomes even more obvious if we take into consideration that this immense appreciation of AUD happened during the Asian session. Needles to say that at this moment AUD is overbought, AUD/USD is testing the resistance pivot points and it seems it doesn't have the strength to break this barrier by itself.
On short term charts (1hr and 15 min) the AUD is giving clear signs of reversal, so a good thing would be to keep an eye on this pair until the down trend is fully confirmed and then go short around 1.0000. A stop loss between 1.0150 and 1.0200 should be safe.

(the image is from a 3hrs AUD/USD chart)

USD/SGD is prepairing it's comeback to a bullish signal we could take advantage of it today(maybe). Keep in mind that this is an intra-day analysis.
Still, keep in mind that this is not a predictions, it's only a hint of what to expect on short term.
I strongly advise you not to act before this bullish signal gets strongly confirmed.
On a daily basis USD/SGD should continue the bearish trend, so manage your risk carefully if you are to trend this pair.

AUD/USD, currently oversold, is preparing for an intra-day bearish signal, and with some luck we could take advantage of it on 1hr or 15 minutes charts, depending on the taste.
Keep in mind that this is an important week for USD, as the Feds are announcing the rate decision, so better think twice before acting.



Watching this pair during the day seems to have payed off. The bearish signal was confirmed on the 15 minutes chart around 10:45 GMT and it is coming to an end.
The pair started to go down from 0.9891 and now, at 0.9853 seems to be close to the oversold position when the down mini-trend is not safe enough anymore.

All in all, watching this AUD/USD signal payed off and those of you who managed to take advantage of it should be happy with your 40-50 pips profit.

The GBP/USD intraday signal is developing quite well right now. Keep an eye on it also but bear in mind that the GBP/USD pair is currently in a consolidation process, so don't expect from the market to give you clear signals for large movements.

GBP/USD, currently oversold, is preparing for an intra-day bearish signal, and with some luck we could take advantage of it on 1 hr or 15 minutes charts, depending on the taste.
Keep in mind that this is an important week for USD, as the Feds are announcing the rate decision, so better think twice before acting.

The EUR/USD pair has been obviously bullish and despite the latest moves, which offered hope for a reversal, the larger picture still remains with EUR/USD targeting the 1.4500 position.
Still, a daily close above the 1.4160 (the highest high set o October 15 ) will be necessary to confirm the bullish trend to 1.4500 (and higher).

This Wednesday we have the Federal Open Market Committee Rate Decision which will greatly influence the pair's movement. Although this event is expected to trigger the pair's rally(and this thought is encouraged by the fact that the European calendar doesn't have major events this month ), it's better to act with precaution than regret later, so until then I advise only intra-day trading for EUR/USD. Until Wednesday don't open new positions that cannot be closed the same day.

Until Wednesday I expect to see some intra-day bearish signals for EUR/USD, although, because of the big event, there will be much indecision these days and opening new positions will be quite risky.