Forex Speculators Betting Big on Bullish Fed Statement

The U.S. Dollar is trading sharply lower at the mid-session against most currencies with the exception of the Japanese Yen.

The U.S. Dollar is trading sharply lower at the mid-session against most currencies with the exception of the Japanese Yen. Speculators are betting big that the Fed FOMC statement will indicate there still is time to buy higher risk assets before the Fed begins tightening.

The EUR USD is trading higher after breaking out over downtrending resistance at 1.4783 and a 50% price at 1.4776. Both of these prices are now support. The charts indicate 1.4873 to 1.4918 are the next upside targets.

Speculators are bidding up the GBP USD ahead of today’s Fed announcement and tomorrow’s Bank of England meeting. The British Pound is in an uptrend and the trend will be reaffirmed on a trade through 1.6603. The October high at 1.6691 is also an upside target.

Strong demand for higher yielding assets is helping the Dollar today versus the Japanese Yen. The USD JPY broke out to the upside over a downtrending Gann angle at 90.82. In addition, a 50% price at 90.75 was taken out. This helped fuel the rally. Bullish news could extend the rally to 91.12.

Weakness in the USD CHF has put this pair in a position to change the main trend to down on a move through the last swing bottom at 1.0155. A move through this level will also take out a 50% price at 1.1058. Resistance is at 1.0212.

The USD CAD is trading weaker but erasing some of its earlier losses at the mid-session. Downtrending resistance is at 1.0710. The charts indicate that 1.0522 is the next short-term downside target.

The AUD USD tried to break out to the upside but ran into resistance at a 50% price at .9117. A breakout over this level could trigger a further rally to .9167. Gann angle resistance at .9129 could slow down the rally.

The NZD USD is sitting on a downtrending Gann angle at .7235 while traders decide which way to take it. This price could turn into resistance or a break out level. If the market turns bullish then .7358 is a potential upside target.

James A. Hyerczyk has been actively involved in the futures markets since 1982. He has worked in various capacities within the futures industry from technical analyst to commodity trading advisor. Using W. D. Gann Theory as his core methodology, Mr. Hyerczyk incorporates combinations of pattern, price and time to develop his daily, weekly and monthly analysis. His firm, J.A.H. Research and Trading publishes The Forex Pattern Price Time Report... More

Disclainer: