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Hawkish

Gold:$2700 in Sight Amid Falling Interest Rates & Rising TensionHey Realistic Traders, let’s dive into the analysis of OANDA:XAUUSD In the H4 timeframe, gold has touched the bullish trendline three times before continuing its upward trajectory. This consistent support underscores the strength of the bullish trend. Recently, the price formed a descending broadening wedge pattern followed by a breakout, signaling further bullish potential. Over the past few days, gold has held strong above the upper trendline, increasing the likelihood of sustained bullish momentum. Additionally, the MACD has made a bullish crossover, indicating upward momentum. With these technical indicators aligning, we could see an exciting continuation of this upward movement toward Target Area 1 at $2,708, or even reaching Target Area 2 at $2,766. However, traders should watch the stop-loss level at $2,614 closely. A break below this level could give bears a chance to take control. Stay tuned and be ready to capitalize on these movements! Fundamental factors support the bullish trend in gold prices. Global central banks are cutting interest rates to boost their economies, leading to weaker currencies compared to gold. Additionally, geopolitical tensions are escalating, exemplified by the unprecedented Israeli attacks on Lebanon and the killing of Hezbollah’s leader on September 27, which may provoke retaliation. This global uncertainty is driving investors to seek safe-haven assets, particularly gold. Disclaimer: "Please note that this analysis is solely for educational purposes and should not be considered a recommendation to take a long or short position on Gold. " Please support the channel by engaging with the content, using the rocket button, and sharing your opinions in the comments below.
OANDA:XAUUSDLong
by financialfreedomgoals101
EUR/USD: Will ECB Resume Rate Cuts Next Week? Futures markets are pricing in a US rate cut for September, with a 62% chance of a 25-basis point cut and a 38% chance of 50-basis points. The Fed’s dovish shift has helped the euro surge to its highest level in more than a year. Attention now shifts to the ECB’s 12 September rate decision. After cutting rates in June and pausing in July, analysts expect the ECB to resume easing amid slowing growth. However, ECB board member Isabel Schnabel, a key hawk, maintains that inflation concerns should take priority over growth concerns. For EUR/USD, bulls may target the December high of 1.1134 and July high of 1.1275, with support possibly near 1.1000.
by BlackBull_Markets
Bullish DXY (Post FOMC Analysis 13th June)The DXY spiked higher from the 104.20 price level to 104.60 during the release of the FOMC interest rate decision and the press conference. The move higher has continued through the Asia session with the DXY now approaching the 105-round number level (around the 50% Fibonacci retracement level from the move yesterday) This bullish move in the DXY is likely due to the FOMC adopting a conservative undertone during the news release. Conservative due to - "We don't see ourselves as having the confidence that would warrant policy loosening at this time" - "We need further confidence, more good inflation readings but won't be specific about how many to start rate cuts" - Indicating the potential of only 1 rate cut decision to come for the 2nd half of the year - "Rate cuts that might have taken place this year, take place next year" If the economy progresses along its current path, the FOMC dot plot suggests that terminal rates for 2024 is likely to be 5.1%. Adopting a conservative stance on rates for 2024 (which could be offset by a more aggressive rate decision in 2025, 4 cuts expected) is bullish for the DXY as it indicates that rates could remain high for longer. Look for the DXY to continue climbing to the upside, toward the immediate resistance level of 105.60 (which coincides with the 61.8% Fibonacci retracement level from the longer term) Beyond 105.60, the DXY could retest the high from April at 106.40
TVC:DXYLong
by JinDao_Tai
How Do Dovish and Hawkish Monetary Policies Affect Markets?How Do Dovish and Hawkish Monetary Policies Affect Markets? In the intricate dance of global finance, central banks play a leading role, their policies echoing through markets and economies. The terms "dovish" and "hawkish" encapsulate their strategies towards interest rates and money supply, each with profound implications for currency values and investor strategies. This FXOpen article explores how these stances offer valuable insights for traders in understanding the forex market’s movements and the broader economic landscape. Understanding Dovish vs Hawkish In the world of economics, central banks use monetary policy to navigate between stimulating growth and controlling inflation. This delicate balance is often characterised by two primary stances: dovish and hawkish. Understanding these policies is crucial for traders, as they significantly influence domestic economic conditions and the forex market. Dovish Meaning Central banks take a dovish monetary policy stance, aiming to stimulate the domestic economy. By lowering interest rates or keeping them low, central banks make borrowing cheaper, encouraging both businesses and consumers to take loans, invest, and spend. This increase in spending can lead to economic growth, but there's a catch: if the money supply increases too rapidly, it might outpace the economy's growth potential, leading to inflation. In terms of unemployment, dovish policies can lead to job creation as businesses expand. Credit conditions become more lenient, fostering an environment ripe for economic activity. Hawkish Meaning Conversely, a hawkish stance aims to temper inflation and stabilise the economy when it shows signs of overheating. By raising interest rates, central banks make borrowing more expensive, which can cool down excessive spending and investment. This tightening of credit conditions is intended to prevent inflation from rising too high, too quickly. While higher interest rates can attract foreign investment due to the promise of higher returns, leading to an appreciation of the domestic currency in the forex market, they can also dampen economic growth and increase unemployment rates as financing becomes costlier for businesses. Likewise, a stronger currency can affect exports by making them more expensive for foreign buyers, which is a critical consideration for traders analysing trade-heavy economies. Capital Flows and the Forex Market The interplay between these monetary policies and capital flows is a critical aspect for forex traders. All else being equal, dovish policies, while boosting local economies, can lead to capital outflows as investors search for higher yields, causing the domestic currency to depreciate against its counterparts. However, a dovish policy can increase the attractiveness of investing in local stock markets due to cheaper borrowing costs. On the other hand, hawkish policies attract foreign capital, appreciating the domestic currency, but potentially at the cost of slowing domestic economic growth. Hawks and Doves: The Balance The interplay between hawks and doves in central banking shapes the forex markets in profound ways. Traders meticulously analyse statements and policy directions from central banks and policymakers to gauge future price movements, which can be complemented by a wealth of trading tools in FXOpen’s free TickTrader platform. A shift from a dovish to a hawkish stance (or vice versa) can lead to swift and significant currency movements as markets reposition based on the anticipated impact on interest rates and economic growth. For instance, even the mere expectation of a shift towards a more hawkish policy can strengthen a country’s currency as traders anticipate higher future returns. Monetary Policy : Dovish Effect Low interest rates are expected to boost economic growth: - Low rates encourage consumers and businesses to borrow (credits/loans) - Cheap borrowing encourages consumers and businesses to invest and spend more - Expanded businesses lead to rising employment Risks: - High inflation if the money supply increases too rapidly - Capital outflow and weak domestic currency due to lower returns for investors Monetary Policy : Hawkish Effect High interest rates are used to control an overheating economy: - High interest rates lead to a reduction in borrowing - Expensive borrowing leads to lower spending and investment, which causes lower prices and potentially lower inflation - Higher rates lead to larger foreign investments due to higher returns, thus, stronger domestic currency Risks: - Slowing domestic economic growth due to reduced spending and investment - Higher unemployment due to expensive borrowing for businesses and, therefore, inability to expand Case Studies: USD/JPY Post-Pandemic The USD/JPY currency pair witnessed a remarkable, bullish run post-COVID-19 pandemic, significantly influenced by diverging inflationary trends and monetary policy responses in the United States and Japan. This period underscored the profound impact of interest rate differentials on forex markets. In the United States, a rapid acceleration of inflation was observed, with core inflation YoY increasing from 1.6% in March 2021 to an alarming 6.5% by March 2022. This inflationary surge compelled the Federal Reserve to initiate a series of aggressive rate hikes beginning in March 2022, escalating the benchmark interest rate from 0.25% to 0.5%. By July 2023, the US interest rate had surged to 5.5%, a clear indication of the Fed's commitment to quelling inflationary pressures. Japan's economic scenario depicted a starkly different picture. The same inflation metric in Japan rose modestly from -0.3% to 0.8% over the same timeframe. The Bank of Japan (BoJ) continued its long-standing policy of negative interest rates, aiming to stimulate economic growth and combat deflationary risks. This stark contrast in monetary policy trajectories between the two economies created a significant interest rate differential, fueling a strong bullish momentum in the USD/JPY pair. From March 1st 2022, when the Fed commenced its hiking campaign, the USD/JPY rose sharply from an opening of 115.084 to a peak of 151.943 in October 2022. This movement was primarily driven by the growing attractiveness of the dollar as US interest rates rose, offering higher returns to investors compared to the yen, which remained anchored by Japan's negative interest rate policy. How to Trade Based on Monetary Policy Using monetary policy to formulate trading ideas involves gauging central banks’ actions and their implications for the wider currency market. Traders who grasp the nuances of these policies can position themselves to take advantage of expected movements in the forex market. Here’s a focused approach to trading based on monetary policy decisions: 1. Following Central Bank Announcements and Meetings Central banks like the Federal Reserve, European Central Bank, and Bank of Japan regularly hold meetings to discuss monetary policy. The outcomes of these meetings, including interest rate decisions and policy statements, can significantly affect currency markets as they rapidly incorporate this new information. Traders mark these events on their calendars and prepare for increased volatility during and after announcements. 2. Analysing Policy Statements for Future Directions Central bank policy statements provide insights into the bank's view of the economy and its future policy direction. Phrases indicating concerns about inflation might suggest a hawkish stance, potentially leading to rate hikes. Conversely, mentions of economic risks could indicate a dovish tilt, with possible rate cuts. Understanding these subtleties can give traders clues about future currency movements. 3. Monitoring Economic Indicators Economic indicators like inflation rates, employment data, and GDP growth are closely watched by central banks and can influence their monetary policy decisions. Traders analyse these indicators to anticipate central banks' actions. For example, rising inflation above the central bank target might prompt a central bank to adopt a hawkish stance, potentially strengthening the currency. 4. Understanding Interest Rate Differentials Interest rate differentials between countries are a fundamental driver of currency movements. Currencies from countries with higher interest rates often attract more investment, leading to appreciation. Traders can use this knowledge to trade currency pairs, expecting appreciation in currencies from countries likely to raise rates and maintain higher rates compared to their trading partners. 5. Considering the Global Economic Context Monetary policy does not operate in a vacuum. Global economic conditions, geopolitical events, and market sentiment can all influence the effectiveness and impact of central bank actions. Traders must consider these factors, understanding that unexpected global events can quickly alter the expected effects of monetary policy decisions. Caveats to Hawkish and Dovish Monetary Policy While dovish and hawkish monetary policies wield significant influence over economic landscapes and forex markets, they come with nuances that traders and policymakers must navigate. A dovish stance, though effective for stimulating economic growth, can lead to unintended consequences like asset bubbles due to prolonged low interest rates, making economies vulnerable to inflation spikes. If not carefully managed, this environment might erode purchasing power and destabilise financial markets. Conversely, hawkish policies, designed to curb inflation by raising interest rates, might slow economic growth excessively or lead to higher unemployment rates. Such outcomes can strain consumer spending and investment, potentially tipping an economy into recession if overapplied. Moreover, the global interconnectedness of markets means that a policy shift in a major economy can have ripple effects, impacting emerging market currencies and potentially leading to capital flight from countries with lower interest rates. Traders must consider these broader implications, as central banks' shifts between dovish and hawkish stances can lead to volatility and unpredictability in currency values. The Bottom Line The interplay between dovish and hawkish monetary policies not only shapes the global economic narrative but also creates pivotal moments for forex traders. By meticulously analysing these stances, traders can navigate the forex market with greater acumen, anticipating shifts that could affect currency values. For those looking to leverage these insights into actionable strategies, opening an FXOpen account offers a gateway to applying this knowledge in the real-world arena of forex trading. FAQs What Is Dovish vs Hawkish? Dovish and hawkish are terms used to describe the monetary policy stance of central banks. A dovish policy focuses on stimulating economic growth by lowering interest rates and increasing the money supply, potentially leading to a weaker currency. Conversely, a hawkish policy aims to control inflation by raising interest rates and reducing the money supply, typically resulting in a stronger currency. These stances significantly influence currency values, affecting forex trading strategies. What Does Hawkish and Dovish Mean in the Forex Market? In the forex market, hawkish and dovish policies influence currency pairs' direction. A central bank's hawkish stance can lead to currency appreciation due to higher interest rates attracting foreign capital. On the other hand, a dovish stance might cause currency depreciation as lower interest rates decrease the currency's yield, prompting investors to seek higher returns elsewhere. Traders closely monitor these policy shifts to anticipate market movements. This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
Education
by FXOpen
5
Gold Under the weight of a hot CPIIn tomorrow's trading session, the spotlight is on XAUUSD as we consider a selling opportunity around the 2043 zone. To form a nuanced view, it's imperative to juxtapose the recent Consumer Price Index (CPI) data with preceding figures. The CPI figures from today—3.4% actual, 3.2% forecast, and 3.1% previous—demonstrate a slight uptick, indicating inflationary pressures persisting in the economy. Comparing this to the preceding months, we observe a gradual decline from 3.7% in October to 3.2% in August. Despite today's uptick, the overall trend signals a moderation in inflation. Now, let's delve into the implications. The unexpected nature of today's CPI data, surpassing both expectations and the previous figure, introduces an element of surprise. Markets are sensitive to such surprises, particularly when it comes to inflation, as they can influence monetary policy decisions. A stronger-than-expected CPI could lead to speculations of a more hawkish stance from central banks, notably the Federal Reserve. Traders may anticipate a potential interest rate hike, a move that tends to strengthen the currency. Consequently, we can anticipate a favorable environment for the US dollar in tomorrow's session. Adding a technical layer to our analysis, Gold is currently navigating a downtrend, with a correction phase approaching the 2043 support and resistance area. The technical outlook aligns with the fundamental expectation of a potentially stronger US dollar. Gold and the US dollar often exhibit a negative correlation, where a stronger dollar tends to put downward pressure on gold prices. Traders should bear this in mind when considering positions in XAUUSD. In conclusion, the intersection of fundamental and technical factors paints a compelling narrative for tomorrow's trading session. The unexpected strength in CPI data introduces an element of uncertainty, and traders should remain vigilant to potential shifts in market sentiment. The technical setup in XAUUSD aligns with the fundamental expectation of a stronger dollar, emphasizing the importance of a holistic approach in navigating the markets. Trade wisely, Joe
OANDA:XAUUSDShort
by JoeChampion
6
EURUSD Faces Headwinds as Dollar Strengthens?EURUSD struggled to build on yesterday's gains and experienced a decline since the start of Tuesday's Asian session. The surge in the US Dollar index exerted additional pressure on this currency pair, causing it to slip below the critical 1.0600 level. The anticipation of a more stringent stance by the Federal Reserve (Fed), supporting the upward trajectory of US bond yields and fortifying the US dollar, impeded EURUSD from extending its upward momentum seen in yesterday's trading. This aligns with the prevailing sentiment from the European Central Bank (ECB) that suggests no imminent interest rate hikes. This sentiment gained further credence from data indicating a deceleration in Germany's annual consumer inflation, dropping from 4.3% to 3.0% in October. This marks the lowest inflation rate since August 2021, a concerning development amid looming recessionary threats. Market participants remain confident in the Fed's commitment to its hawkish stance, given the resilience of the US economy in the face of persistently high inflation. However, all eyes are now fixed on the outcomes of the FOMC meeting and subsequent statements on interest rate policies. Today's Market Focus: Market participants are eagerly awaiting signals for today's potential market movements, with a particular focus on the release of Eurozone CPI data for short-term trading opportunities. Subsequently, attention will shift to the release of key macroeconomic data from the US, including the Chicago PMI and Consumer Confidence Index from the Conference Board. Trading Opportunities: As market projections suggest that the European Central Bank will maintain interest rates, and the Fed is expected to adhere to its hawkish stance, the weakening of EURUSD below the 1.0600 level remains a prevailing theme. This weakness is exacerbated by the strengthening US dollar and rising bond yields ahead of the FOMC meeting. Technical Analysis: In terms of technical analysis, the Fibonacci retracement at 23.6% (1.0643) acts as an immediate resistance level, followed closely by the 50-day Exponential Moving Average (EMA) at 1.0654. A potential reversal at these levels could instigate a decline in the EUR/USD pair. The technical dynamics of the EUR/USD pair indicate a notable weakening in momentum, notably signaled by the 14-day Relative Strength Index (RSI) dropping below the pivotal 50 level. This RSI movement suggests a bearish momentum, underscoring a broader sentiment of market weakness. Trading Strategy: Observing the current market conditions, it appears there is potential for executing a SELL action at the 1.0585 level should the EURUSD persist in its downward trend. In such a scenario, astute traders may contemplate a strategic approach by establishing a profit target at the 1.03500 level. Additionally, incorporating flexibility to adjust stop-loss levels proves to be a prudent measure, aligning with the individual considerations of each trader. However, it is imperative to underscore that trading decisions must consistently derive from meticulous analysis and a profound understanding of the associated risks. Deliberations regarding a SELL action or any trading maneuver should be approached judiciously. Traders are well-advised to take supplementary steps, such as staying abreast of current economic news or other market factors, before arriving at a definitive decision.
Short
by fardycurry
US10Y: Soaring Bond Yields as Federal Reserve Maintains Hawkish The Fed Hawkish Stance During Wednesday's address, Federal Reserve Chair Jerome Powell reinforced his stance on tackling inflation with a more cautious approach. He emphasized that the central bank is not yet finished with its efforts to curb inflation and hinted at the possibility of implementing multiple interest rate increases during future monetary policy meetings. Powell's statement comes as a response to the ongoing challenge of bringing down inflation, which has consistently remained above the central bank's target of 2%. Notably, some Fed officials have emphasized in recent speeches that inflationary pressures persist. They specifically highlight core inflation, which excludes the volatile prices of food and gas, as not decelerating as rapidly as overall inflation. The aforementioned statement supports the potential scenario of higher Government Bond Yields in the future, as an increase in interest rates typically correlates with elevated yields. Technical Analsyis The U.S. government's 10-Year Bond Yield has undergone a retracement, precisely at the 0.5 Fibonacci ratio, establishing a support area. Notably, the yield currently exhibits a bullish trend as it remains above the EMA 200 line, indicating positive market sentiment. Furthermore, the Falling wedge pattern suggests a continuation of the prevailing trend. Complementing this observation, the stochastic line crosses within the neutral area, further bolstering the case for a possible upward movement toward the target area. It is important to keep in mind that once the target/support area is reached, the roadmap provided may no longer be valid. If you find this analysis helpful, I encourage you to show your support by clicking the rocket button and sharing your opinions in the comments section below. "Disclaimer: This analysis is intended solely for educational purposes and should not be considered as a recommendation to take a long or short position on the TVC:US10Y ."
TVC:US10YLong
by financialfreedomgoals101
9
China is going to do something different this timeChina will print, there is no way around it, at the same time the dollar will fall, I do not know how they will pull that rabbit out of the hat but they will, China will get richer while the street americans get stiffed by tough financial conditions and high rates as it is right now, chinese money is going to push-up the SP500, SP500 at this time and place is a global market, not only american anylonger... does not matter how financial condition will get strict in america, international big and smart money will get in anyway, It is a new world order...
OANDA:SPX500USDLong
by awesomenewsforyou2
Higher for LongerUS inflation data in July 2023 provided mixed signals. While Consumer Price Index (CPI) is moving in the right direction, producer price inflation suggest pipeline pressures are picking up. Core CPI, which excludes often-volatile food and energy costs, rose only 0.2% for a second month in a row . However, US producer prices picked up in July, owing to increases in certain service categories. This likely buys more time for the Federal Reserve (Fed) to deliberate on the future path of monetary policy. The flows into bond exchange traded funds (ETFs) have been volatile. Over the past year, investors were starting to embrace duration. Investors were positioned for recession, inflation crash, and Fed cuts - evident from $31.7bn inflows to Treasury bond ETFs on pace for a record year2. However, investors are starting to pull out of the biggest bond ETFs devoted to Treasuries. More than $1.8 billion came out of the $39 billion iShares 20+ Year Treasury Bond ETF last week, the most since March 20203. Sentiment toward long-dated Treasuries has soured over the past month amid growing conviction that the Fed will keep interest rates at elevated levels for an extended period. We expect rates to remain higher for longer and are unlikely to see the Fed cut rates until the Q1 of next year amidst a stronger US economy. Don’t celebrate on disinflation just yet Overall, the US economy continues to show extraordinary resilience despite monetary constraints and credit tightening. While inflation has shown encouraging signs of decline, we caution that the level remains high. Strong July retail sales raise the risk of a re-acceleration in inflation. The four biggest categories of the ex-auto’s component saw outsized gains: non-store retailers, restaurants & bars, groceries, and general merchandise. Amidst a tight US labour market, with unemployment at historic lows and wages continuing to rise, the downward pricing momentum in the service sector is likely to be at a slower rate. Commodity prices are also beginning to rebound from the weakness seen in Q2 2023. Energy prices have been rising on the back of Organisation of Petroleum Exporting Countries and its allies (OPEC+) production cuts. If commodity prices extend their recent momentum, it could pose upside risks to inflation. Fed Officials remain divided Messaging on a somewhat mixed inflation outlook from the Fed Officials remains a mixed bag. One faction remains of the view that rates hikes over the past year and a half has done its job while another group contends that pausing too soon could risk inflation re-accelerating. Fed governor’s Michelle Bowman and Christopher Waller remain in the hawkish camp, hinting at more rate increases being needed to get inflation on a path down to the 2% target. Futures markets are assigning about a 11% chance of a 25-basis-point rate hike when the Fed next meets on 19 and 20 September4. Additionally, rate cuts have now been completely taken off the table until perhaps later in the Q1 2024. The latest Fed minutes reveal commentary from officials, including the hawks, such as Neel Kashkari, suggest a willingness to pause again in September, but to leave the door open for further hikes at the upcoming meetings5. Opportunity for a yield seeking investor It’s been an impressive turnaround since the pandemic when negative real yields became the norm. TINA- ‘There Is No Alternative’ to equities, is over now that evidence of the shift to a 5% world appears stronger than ever. Today investors have the opportunity to lock in one of the highest yields in decades, with US two-year yields paying close to 5% exceeding the yields at longer maturities without the volatility witnessed in the 10-year sector. A resilient US economy is likely to keep interest rates and bond yields higher for longer. Sources 1 Bureau of Labour Statistics as of 10 July 2023 2 BofA ETF Research, Bloomberg as of 9 August 2022 - 9 August 2023 3 Bloomberg as of 14 August 2023 4 Bloomberg as of 17 August 2023 5 federalreserve.gov as of 16 August 2023 This material is prepared by WisdomTree and its affiliates and is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. The opinions expressed are as of the date of production and may change as subsequent conditions vary. The information and opinions contained in this material are derived from proprietary and non-proprietary sources. As such, no warranty of accuracy or reliability is given and no responsibility arising in any other way for errors and omissions (including responsibility to any person by reason of negligence) is accepted by WisdomTree, nor any affiliate, nor any of their officers, employees or agents. Reliance upon information in this material is at the sole discretion of the reader. Past performance is not a reliable indicator of future performance.
FRED:FEDFUNDS
by aneekaguptaWTE
Markets Calling the "Hawkish" Bluff of Powell?S&P 500 INDEX MODEL TRADING PLANS for THU. 06/15 The potential bull trap cautioned about by our models continues to be in play, while the markets seem to be calling the bluff of Powell's hawkish posturing in yesterday's "hawkish pause" presser. Nevertheless, bears should be cautious of not jumping the gun but wait for confirmation before initiating any shorts. It is a bull market until it is broken - currently, this bull run is not broken. Positional Trading Models: Our positional models indicate no positional trading plans for today, as they are wary of a potential bull trap ahead. By definition, positional trading models may carry the positions overnight and over multiple days, and hence assume trading an instrument that trades beyond the regular session, with the trailing stops - if any - being active in the overnight session. Aggressive/Intraday Models: Our aggressive, intraday models indicate the trading plans below for today. Aggressive, Intraday Trading Plans for THU. 06/15: For today, our aggressive intraday models indicate going long on a break above 4425, 4400, 4392, 4475, or 4361 with a 9-point trailing stop, and going short on a break below 4397, 4389, 4371, 4358, or 4337 with a 9-point trailing stop.  Models indicate explicit long exit on a break below 4420, and short exits on a break above 4343 or 4383. Models also indicate a break-even hard stop once a trade gets into a 4-point profit level. Models indicate taking these signals from 11:01am ET or later. By definition the intraday models do not hold any positions overnight - the models exit any open position at the close of the last bar (3:59pm bar or 4:00pm bar, depending on your platform's bar timing convention). To avoid getting whipsawed, use at least a 5-minute closing or a higher time frame (a 1-minute if you know what you are doing) - depending on your risk tolerance and trading style - to determine the signals. (WHAT IS THE CREDIBILITY and the PERFORMANCE OF OUR MODEL TRADING PLANS over the LAST WEEK, LAST MONTH, LAST YEAR? Please check for yourself how our pre-published model trades have performed so far! Seeing is believing!)  NOTES - HOW TO INTERPRET/USE THESE TRADING PLANS: (i) The trading levels identified are derived from our A.I. Powered Quant Models. Depending on the market conditions, these may or may not correspond to any specific indicator(s). (ii) These trading plans may be used to trade in any instrument that tracks the S&P 500 Index (e.g., ETFs such as SPY, derivatives such as futures and options on futures, and SPX options), triggered by the price levels in the Index. The results of these indicated trades would vary widely depending on the timeframe you use (tick chart, 1 minute, or 5 minute, or 15 minute or 60 minute etc.), the quality of your broker's execution, any slippages, your trading commissions and many other factors. (iii) These are NOT trading recommendations for any individual(s) and may or may not be suitable to your own financial objectives and risk tolerance - USE these ONLY as educational tools to inform and educate your own trading decisions, at your own risk. #spx, #spx500, #spy, #sp500, #esmini, #indextrading, #daytrading, #models, #tradingplans, #outlook, #economy, #bear, #yields, #stocks, #futures, #inflation, #recession, #fomc, #fed, #fedspeak, #softlanding, #hawkishpause, #pause
CBOE:SPX
by TradersAIDotCom
Market Reactions to Fed’s “Hawkish Pause” Today the Federal Reserve chose not to proceed with an 11th consecutive interest rate hike, opting instead to assess the effects of the previous 10 hikes. However, the Fed announced that it anticipates implementing two additional quarter percentage point increases before the year concludes. While the pause was largely expected, the fact that policy makers see rates at 5.6% at year-end was what caught the market off-guard. The combination of the pause with the suggestion of two more 25 basis points hikes has been dubbed the “hawkish pause”. Following the decision, stock market closing results were mixed. The Dow Jones closed more than 230 points lower, while the S&P 500 and the Nasdaq experienced gains of 0.1% and 0.4% respectively. The Nasdaq Composite was primarily bolstered by the gains made in AI-adjacent stocks of Nvidia and AMD. The day began with Bitcoin surpassing $26,000. However, it has since retraced to a 24-hour low of $25,791. Some analysts are predicting an inevitable drop to $25,000 based on recent cryptocurrency news that is dominated by discussions on regulation. Meanwhile, gold prices initially rose to touch $1959 per ounce in the session but later trimmed gains, trading around $1945. The dollar has weakened across the board, with the DXY down 0.32%. The NZD is the biggest mover, rising by more than one percent to a 3-week high of $0.6211. Gains in EUR and GBP were more modest, at +0.39% each.
BLACKBULL:XAUUSD
by BlackBull_Markets
USDJPY Potential UpsidesHey Traders, In today's trading session, we are closely monitoring the USDJPY currency pair for a potential buying opportunity around the 139.700 zone. After trading in a downtrend, USDJPY has recently broken out and is currently in a correction phase approaching the retrace zone near the 139.700 support and resistance area. A key factor to consider today is the US monetary policy, specifically the Federal Reserve's interest rate release. If the statement reflects a more hawkish stance than expected, signaling potential future interest rate hikes, it could provide additional confirmation for a USDJPY buy trade. As traders, it is important to conduct thorough analysis, considering technical indicators, price charts, and patterns. Additionally, monitoring fundamental factors such as central bank decisions and economic data releases can provide valuable insights. It's crucial to stay informed about market sentiment and overall market conditions. Remember that trading involves risks, and it is advisable to have a well-defined trading plan, including risk management strategies, in place. Trade safe, Joe.
Long
by JoeChampion
20
Upside risks for USD/JPY continue to buildIt may have taken a few weeks, but markets are finally pricing in what we argued all along; a higher terminal rate and no cuts this year. If you cast your mind back to the Fed’s recent 25bp hike, it is fair to say the Fed were not impressed with the market’s original response. Fed fund futures not only lowered the terminal rate to 5% but even began pricing in two cuts this this. And that has all been reversed, and rightly so in our view. Fed members were quick to respond and read from the same hawkish script, with little success early on as markets continued to call ‘bulldust’ on their rhetoric. That is, until a strong Nonfarm payrolls report shook things up, as it paved the way for further hikes. Yet it has taken over two weeks, a plethora more hawkish comments and strong data for markets to slowly wake up to the fact that a higher terminal rate is the more likely path for the Fed, and for us to forget about cuts this year. And that is the scenario we have backed throughout. February data which has underscored the Fed’s hawkish stance include (but not limited to): • Nonfarm payrolls 517k (185 expected, 186k previous) • Unemployment 3.4% (3.6% expected, 3.5% previous, near historic lows) • ISM services 55.2 (50.4 expected, 49.2 previous) • CPI 6.4% y/y (6.2% expected, 6.5% previous) • Retail sales 3% y/y (1.8% expected, -1.1% previous) • Core retail sales 2.3% (0.8% expected, 0.4% previous) • PPI 0.7% m/m (0.4% expected, -0.2% previous) Fed fund futures now imply: • 76% chance of a 25bp hike in March (down from over 90% two weeks ago) • 25.5% chance of a 50bp hike in March (up from 9% two weeks ago, or 0% three weeks ago) • A terminal rate of 5.5% in June (up from 5% terminal rate after the Fed’s last meeting) • Less than a 35% of a 25bp cut in December (two cuts were being priced in after the Fed’s Fed meeting) What are we looking for in the FOMC minutes? For current market pricing to be sustained (or justified, for want of a better word) we’ll need to see a more finely balanced debate over a 50bp hike versus a 25bp in Feb or even March. Markets took it for granted that a 25bp was a given in February, so any uncertainty surrounding this assumption would knock confidence that another 25bp hike in March is a given. And that could send the US dollar and yields higher, and the stock market and gold lower. USD/JPY daily chart USD/JPY reached our upside target around the 200-day EMA / 161.8% Fibonacci projection outlined last Monday, following its false break of 130 and prominent bullish pinbar. Momentum is clearly pointing higher overall, and the recent repricing of Fed fund futures and rise in bond yields ahead of the FOMC minutes provides hope that its trend can continue (if the minutes are deemed to be hawkish, as we suspect). The high around 138 are the next major resistance level, near where another soft US CPI print and the BOJ widening their YCC band originally sent the pair lower.
Long
by CityIndex
WHAT HAPPENED WITH JPY?Hello guys! Here is a quick summary of what happened in the market today, especially in the Japanese one, after the Bank of Japan surprised everyone. On Tuesday, the Bank of Japan made its first move towards a shift away from ultra-loose monetary policy after weeks of speculation. As part of an adjustment to its yield curve control policy, the BoJ decided to increase the range of its target for the yield on 10-year government bonds from +/- 25 basis points to +/- 50 basis points. Despite this change, the Bank kept its short-term policy rate at -0.1% and maintained its commitment to easing in its statement. In fact, the BoJ plans to increase its purchases of Japanese government bonds in the coming quarter, from 7.3 trillion yen per month to 9 trillion yen. The Bank of Japan's policy adjustment was more hawkish than financial markets had anticipated, and contributed to the yen's further recovery from a 30-year low reached this October. A stronger yen may provide some relief to the Japanese economy, which has been grappling with the high cost of imports due to the sharp decline in the value of the yen this year. As the possibility of more hawkish central bank actions and a potential recession in 2023 increased, the value of Asian currencies against the US dollar decreased further and risk appetite remained low. While the US dollar strengthened against most Asian currencies, the strength of the yen, euro, and pound weighed on the dollar index and dollar index futures. What do you think about the BoJ's move? FX:USDJPY FX:USDJPY BMFBOVESPA:JPY1! PEPPERSTONE:JPYX
Short
by m_maia14
4
Pure bearish trend Obviously across boards USD as the Quote currency have been on a bearish move due to the Hawkish nature of the dollar index ,interest rates etc From the point of Technicals on the chart I'm expecting price to touch the Immediate SUPPLY zone with a good PA we are good to short the pair But looking at the OB spotted above the currently S zone makes the immediate zone look like an IDM or an engineered Liquidity Putting that into consideration I would get in conservatively if I get a PA at the currently S zone and watch how price plays out to further look for more entry zones or otherwise
Short
by HoneypiesfxS
1