US Dollar, EUR/USD, GBP/USD, USD/CAD Price Analysis
- Today at 2PM ET brings the FOMC[1] for the January rate decision.
- There are minimal expectations for any actual moves.
- The focus for today is on clues or hints as to what the FOMC might do later in the year.
US Dollar Perched at Highs Ahead of FOMC
The US Dollar[2] is nearing the close of what’s become a really strong month; and the currency has clawed back almost the entirety of the December sell-off with a key zone of resistance sitting overhead. This area runs from 98.33-98.50 and this is the spot on the chart that held the highs in DXY in both mid-November as well as later-in-the-month as the door opened into December trade. After setting a fresh five-month-low on the final trading day of 2019, with the USD[3] getting an assist from a long-term Fibonacci level as support; buyers have been at work through January to push the USD-higher by as much as 1.9%.
At the source of the move has been diminishing hopes of any near-term rate cuts out of the FOMC, with today’s meeting bringing expectations for the bank to hold flat. From rates markets, however, later in the year brings considerably more variability, with December showing a fairly-wide spread of expectations for future FOMC policy. I had looked into this in yesterday’s webinar[4] and this sets up a fairly interesting backdrop around the bank ahead of today’s rate decision, even with the expectation for no near-term moves to be announced.
US Dollar Four-Hour Price Chart
Chart prepared by James Stanley[5]; US Dollar on Tradingview[6]
EUR/USD Testing 1.1000
Ahead of today’s FOMC rate decision the world’s
