Forex Signals Brief for August 16th – FOMC Meeting Minutes In Focus - Forex News by FX Leaders

Forex Signals Brief for August 16th – FOMC Meeting Minutes In Focus

Posted Wednesday, August 16, 2017 by
Arslan Butt • 2 min read

Today, you can feel the excitement of the FX Junkies as they wait to trade top tier economic events from three big economies with the US FOMC at the top of the list. Read ahead to find out what to look for in the FOMC minutes!

Top Economic Events Today

GBP – Labor Market Figures

Average Earnings Index 3m/y is due to be released at 8:30 GMT and economists are expecting it to be 1.8%, just like the previous month's. This a leading indicator of consumer inflation – when businesses pay more for labor the higher costs are usually passed on to the consumer. It leads to inflation and a hike in inflation ultimately forces central banks to hike the interest rates.

Similarly, the Office for National Statistics is likely to release the Claimant Count Change with a forecast of 3.2K, lower than 5.9K (previous). This is the first indication of the employment situation, released a month earlier than the Unemployment Rate.

Simultaneously, the Office for National Statistics will also release the Unemployment Rate, but economists are expecting it to remain unchanged at 4.5%. Nonetheless, a surprise will definitely lead to good trade opportunities. So, let's keep an eye on it.

EUR – Euro

The Flash GDP q/q is expected to come out at 9:00 (GMT) with a neutral forecast of 0.6%. The point to focus on is, the Eurostat has revised the figure for the previous month from 0.5% to 0.6%. This change supports the single currency Euro.

FOMC Meeting Minutes – What To Expect?

The FOMC Meeting Minutes are due to be released at 18:00 (GMT). The Federal Reserve (Fed) officials have drafted a plan to reduce their $4.5 trillion balance sheet, but have yet to decide the starting point.

Basically, these meeting minutes will reflect the July 26th meeting. The Fed hiked the rates in the month of June and also signaled one more hike in the second half of 2017. Now we have to analyze if they continue spreading the same tone and keep supporting the dollar, which is in trouble nowaday due to hawkish stance from peer economies.

EUR/USD – Head & Shoulder Pattern In Play

Yesterday, EUR/USD made a bearish movement and hit our target at $1.1745. Bears entered the market after the German economy grew by 0.6%, missing the consensus forecast of 0.7%.

EURUSD - 2 Hours Chart - Target HitEURUSD – 2-Hour Chart – Target Hit

Now, the pair is still trading lower and has formed a head and shoulder pattern, a bearish one. EUR/USD is likely to complete the right shoulder at $1.1680.

EURUSD - 2 Hours Chart - Head & Shoulder PatternEURUSD – 2-Hour Chart – Head & Shoulder Pattern

In my previous update, I discussed the new sideways to the slightly bearish channel on the 2-hour chart, the pair is still consolidating in the same way.

EUR/USD – Key Trading Levels

Support     Resistance

1.1698    1.1778

1.1673    1.1803

1.1633    1.1843

EUR/USD Trading Plan

Investors are advised to keep a check for $1.1738 as it's a trend decider for today. Below this, the pair can target $1.1680. While, on the upside, it has the potential to go for $1.1800.

Fellows, keep following us for more updates and trades.  All the best and trade with care!

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About the author

Arslan Butt // Index & Commodity Analyst
Arslan Butt is our Lead Commodities and Indices Analyst. Arslan is a professional market analyst and day trader. He holds an MBA in Behavioral Finance and is working towards his Ph.D. Before joining FX Leaders Arslan served as a senior analyst in a major brokerage firm. Arslan is also an experienced instructor and public speaker.
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