FOMC and Dollar Strength
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Thread: FOMC and Dollar Strength

  1. #1
    The Dollar has created some support off of the November low. Some encouragment for swing . However a situation is I could see play today that could change the diretion for the week when the Dollar buyers aren't actually dedicated.
    Perhaps the dollar movement up was a product of the pound weakness. Perhaps we'll see some dollar selling following the morning data response going into the FOMC more selling after a slightly more dovish FOMC statement.

    Will be interesting to see how it plays out now with stack of strong data coming on thursday.

  2. #2
    Another thing technical to think about is that while the Franc and the euro dollar crosses dollar bear station has diminished and shows some potential behaviour that is bottoming, neither has broken from their respective channels leaving us right on the border. It is sort of a pivot area. I find it hard to imagine that today will move to awful challenging with thursdays data that is substantial lurking.

    A fascinating evening for certain.

  3. #3
    There is a report that because of bad data yesterday (ie PPI and Retail Revenue ) there is a growing belief that the FED might consider once more to facilitate early next year the sentiment is 8% as of today...

  4. #4
    What are we expecting from FOMC?

    Any idea?

  5. #5
    IFR has rumors of a hawkish report. Given the USD is sitting around the highs of the session I feel the rumor has been accepted by the market. Best chance now is for USD weakness onto a benigngt report.

  6. #6
    Are we talking about USD weaken?

  7. #7
    Quote Originally Posted by ;
    IFR has rumors of a hawkish report. Considering that the USD is sitting around the highs of the session I think the rumor was approved by the market. Best chance now is to get USD weakness onto a benigngt report.
    The rumors of a hawkish report were definately confirmed by the price action now. That doesn't mean the market is right in the assumption of it. . .just that they reacted to their believe.

    Like all fundamentals, the result is likely to be short lived-or the effect tends to live just as long as pricing action begins towards the upcoming fundamental. If the tone is hawkish and the market starts buying to the core CPI consensus (that keeps inflation over the Fed's target) the $ will definately strengthen further.

    The core PPI was way down:

    lt;TABLE class=tborder style=MARGIN-TOP: 12px cellSpacing=0 cellPadding=3 width=100% align=center border=0gt;lt;THEADgt;lt;TRgt;lt;TD class=alt1 noWrapgt;lt;/TDgt;lt;TD class=alt1gt;8:30am lt;/TDgt;lt;TD class=alt1 align=middlegt;USDlt;/TDgt;lt;TD class=alt1gt;Core PPI m/mlt;/TDgt;lt;TD class=alt1 align=middlegt;https://www.forexsoutheast.asia/cryp...-based-ea.htmllt;/TDgt;lt;TD class=alt1 align=middlegt;-0.9% lt;/TDgt;lt;TD class=alt1 align=middlegt;0.2percent lt;/TDgt;lt;TD class=alt1 align=middlegt;0.6percent lt;/TDgt;lt;/TRgt;lt;/THEADgt;lt;TBODYgt;lt;/TBODYgt;lt;/TABLEgt;


    Can we see exactly the same thing in the core CPI? Is it possible the market might begin to buy in to this chance of a similar amount? Sure. The clue will be supplied during the London trading session tom.

  8. #8
    As with all fundamentals, the effect is very likely to be the effect will live so long as pricing activity starts towards the fundamental. If the tone is hawkish and the market begins buying to the core CPI consensus (which retains inflation over the Fed's target) the $ will definately fortify further.



    Sorry, can you more explain why usd will strengten.
    thx

  9. #9
    Quote Originally Posted by ;
    Like all fundamentals, the result is very likely to be short lived-or the effect tends to reside just as long as pricing action begins towards the next fundamental. If the tone is hawkish and the market starts buying to the core CPI consensus (which retains inflation over the Fed's target) the $ will definately strengthen further.



    Curious, can you explain why usd will further strengten.
    thx
    No Prob. Currencies get stronger as the potential for interest rate rises grows. Hawkish means the Fed is biased towards a rate increase. If the core CPI comes out at.2, that will keep the yearly number at about 2.9, which is over the Feds target inflation rate also would create an interest rate rise more likely. The $ will strengthen on that.

  10. #10
    Ok thx, however if fed decision isn't to increase the rate. ( I mean if they just let the inflation 0n 2.9 and just watch and do nothing) or they remark remains under 3 no worry thx anyway.

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