Tomorrow’s FOMC meeting could have a big impact on the markets, which have been eager to hear some more positive wording about monetary policy, hiking rates. Yellen has been somewhat cautious whilst leaving room for action. But looking at Bloomberg’s Economic Surprise Index you might get the feeling the FED is not going to make any move just yet. The ESI is at -0.728, meaning actual economic data is much worse than forecast. It also hasn’t seen lower levels than that since end of 2008 beginning of2009. So tomorrow could bring a rebound in the EUR/USD and probably extend the decline for the greenback against other currencies as well. The day chart shows today’s price action above the resistance line formed over past 8 sessions. If no clear information is given tomorrow regarding timing I wouldn’t be surprised in seeing a large retracement.

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