Forex Signals Brief for September 18: FOMC to Dominate the Trading Week

Welcome to a big week on forex markets guys!

Last week was certainly an active one for traders as we were dealing with hurricanes in the US, some big central bank meetings and of course the never-ending North Korea saga.

Markets were a little jumpy going into the weekend after yet another missile launch from North Korea on Friday, however, for the most part, the news was largely shrugged off. It’s getting a bit like the boy who cried wolf if you ask me and over the weekend there haven’t really been any developments that have spooked us further.

This week all the attention is clearly going to be on US Federal Reserve Chairman Janet Yellen as the Federal Open Market Committee (FOMC) comes out with their interest rate decision. There’s no suggestion that rates will be hiked at this meeting, however after a strong CPI print last week there will be some keen onlookers to see what exactly the Fed Chairman is thinking, and any inkling of a hike has the potential to spike the USD.

Whenever we have a big rate decision on the agenda, markets can go a little quiet, however, that can often give us a chance to find some good technical spots.

It’s looking like being another exciting week ahead on the forex front so stay tuned for all the analysis that you’ll need right here.

 

Top Economic Events Today

EUR – CPI

Eurozone CPI (Consumer Price Index) is due for release today at 9:00 GMT. Analysts are predicting a yearly figure that will remain unchanged at 1.5%, but an uptick on the monthly number at 0.3%. CPI is the leading indicator of inflation, and any increase will be bullish for the EUR.

GBP – Mark Carney Speaking

Mark Carney’s speech at the Camdessus Central Banking Lecture 2017 is at 15:00 GMT in Washington DC. The GBP has been on fire, so any positive headlines might add more fuel.

 

EUR/USD – FOMC the Driver

This week it’s more about the USD than the EUR. With the FOMC just around the corner, I expect the USD to be a little more coy in its movements. As such I think we have every chance to play within a range early in the week ahead of what Janet Yellen has to say. CPI has the ability to spike us in either direction, but I'm not expecting an extended move.

 

EUR/USD – 240 min Chart

 

Key Levels

Support	Resistance
1.1850	1.1975
1.1822	1.1985
1.1800	1.2000

EUR/USD – Trading Plan

I’m not expecting too much follow through early in the week in what could be a big Wednesday for forex traders. As such I am looking to buy on dips below key support in the EUR/USD at 1.1850. There has been a degree of support, and overall I’m still bullish on the Euro.

 

BTC/USD – What’s Going On with Bitcoin?

It’s been a heck of a week for the Cryptocurrencies with some huge volatility featuring a massive dip and some big buying on Friday. Last week we’ve seen more signs that China is cracking down on Bitcoin and ICOs. That spooked the digital currency world, and they saw heavy selling. JP Morgan boss Jamie Dimon also came out and gave the cryptocurrencies a whack in the press which added some more salt to the wounds.

 

BTC/USD – 240 min Chart

 

Key Levels

Support	Resistance
3500	3825
3000	3880
2600	4000

BTC/USD – Trading Plan

The great thing that Bitcoin and all the cryptocurrencies are offering at the moment is volatility. That volatility also features a large amount of follow through and appears to be being driven by the news.

Trading the news is a great strategy that can give you high probability trades. We see the biggest spikes when the news is negative news. The great thing about being a traders is that ultimately we don’t care what Jamie Dimon has to say or whether or not ICOs are being banned in China. We are looking for volatility and clear directional moves.

This week I suggest paying close attention to the news flow in the crypto world and if there are any short-term headlines, trade with the momentum. Our analysts are right across the cryptos and will keep you up to date with all the very best opportunities in Bitcoin, Ethereum and all the key players.

 

Again we are shaping up for a very big week on the markets. Let’s hope Janet Yellen has plenty to say on Wednesday and it should make for a massive week. Good trading guys.