Hello, dear friends,
On Wednesday, the attention is focused on the Fed's meeting and its interest rate decision. As mentioned earlier, there was no doubt that the rate cut would take place, but due to positive statistics of the last week the situation has changed.
Today's statistics are as follows:
- consumer price index in the UK turned out to be by 0.1% worse than expected. Prior to that, the British pound managed to test the resistance at 1.2500; at the moment a pullback from this level can be observed;
- in August, a decline in consumer price index was recorded in the Eurozone which caused the euro weakening relative to the dollar. EURUSD is trading below 1.1050.
There’s some more important news expected on Wednesday:
- 13:30 CEST - the number of building permits issued in the US is published;
- 13:30 CEST - consumer price index in Canada;
- 15:30 CEST - US crude oil reserves;
- 19:00 CEST - the US Fed interest rate decision;
- 19:30 CEST - the US Open Markets Committee press conference.
A lot of news is expected, so it's recommend to move open positions to breakeven or fix part of the profit, as there’s a high probability of sharp movements.
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EURUSD - growth from the support area is expected
The support at 1.1000 was tested at the beginning of the week; entry point for buying hasn't been received so far.
We expect the EURUSD pair to update the weekly low and enter the support area 1.0926-1.0962. Here, one can search for a reversal pattern and open trades to buy. Profit should be fixed as soon as the level 1.1072 is reached.
Canadian dollar is expected to strengthen
There was an attempt of growth on Tuesday, yet, the level 1.3300 has become an obstacle. There was no sharp drop, so we expect the growth to continue and the chart to enter the range of 1.3331-1.3382.
The key scenario for the nearest future - selling after a reversal construction is formed within the resistance area. As for short positions, there's a potential for the movement towards 1.3182.
In case the pair makes its way through above the level 1.3382, and consolidation takes place, one can open long positions.
USDCHF - both scenarios are considered
The chart has broken out the resistance zone 0.9925-0.9940 for the second time. This doesn't completely abolish scenario implying sales, but the likelihood of upward movement continuation increases. Two scenarios are considered:
- return under the level of 0.9930, its retest from below, and the downward movement continuation to 0.9871. Sales can be opened from the level 0.9930;
- if a return into the range 0.9925-0.9940 takes place, an entry point might be formed at the extension; in this case one can buy with take- profit located at 1,000.
Gold - looking for an entry point for sales
It doesn't make sense to open short positions from current levels.
Key zone for sales is located within the range 1542-1556. We expect the growth to start from current levels, and a reversal model formation to take place within this zone. One can sell with take-profit located at 1497.
From sales point of view, the level 1530 is rather important. Bearish signal may be generated here.