Dollar Flat as Traders Await Fed Announcement

Yesterday’s U.S.mid-term elections do not seem to have had too much of an influence on thevalue of the Dollar as traders have quickly shifted their focus to today’sFederal Reserve monetary policy meeting.

Yesterday’s U.S.mid-term elections do not seem to have had too much of an influence on thevalue of the Dollar as traders have quickly shifted their focus to today’sFederal Reserve monetary policy meeting.

There is no question the Federal Open Market Committee ispoised to implement a new quantitative easing program. The questions over thepast two weeks have been how, and how much?

Since early August, traders had estimated that the centralbank will buy as much as $2 trillion in Treasury Bonds. Analysts are now sayingthe Fed may do something like spend $100 billion a month for the next severalmonths. I agree that the Fed is will nothit the market with “shock and awe”, but $100 billion a month seems pretty low.I’m sticking with $250 billion.

The way things are evolving at this time indicates that theDollar could rally from the support base it has been trying to establish. Muchof the weakness the past few months has been triggered on speculation the Fedwill implement at least $1 trillion so unless the Fed meets or exceeds thisfigure, I can build a case of a Dollar rally. A high number will weaken theDollar; a low number will strengthen the Dollar.

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

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