In little over than two days we will find out whether the long-expected FED interest rate hike will become reality or not.
The closer we get to the announcement, the less volatile the markets will become while waiting for it. What seems obvious even at this stage is that the rate hike seems to have already been traded. The USD/JPY pair rallied for over 1500 pips without a correction, and in the past month and a half EUR/USD dropped with over 800 pips. Even if FED does hike the interest rate, in my opinion, the strongest effect will be highly increased volatility but the USD rally won’t likely continue without a serious correction.
If there is no rate hike, however, we could see a trend reversal and a USD move to the downside.
USD/JPY seems to be already preparing for a drop, considering the RSI divergences on the 4H and daily time frames (the latter will be confirmed when today’s bar closes).
EUR/USD formed an inverted doji bar with a very long shadow on the weekly time frame and it also looks ready for a rebound.
Very helpful analysis.
ReplyDeleteThanks for such an informative analysis.
ReplyDeleteVery helpful post, thanks.
ReplyDeleteVery good note on the EURUSD.
ReplyDeleteGreat analysis, thank you for sharing!
ReplyDeleteGood insight.
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ReplyDeleteExcellent analysis.
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