Markets may well have been expecting the more dovish tone from Fed Boss Jerome Powell, but at the end of the day, they still gave the FOMC a big tick of approval.
Global markets have been on edge since the FOMC really started ramping up the expectations for rate hikes. After markets crashed in the lead up to Christmas, many started calling for the Fed to take their foot off the pedal.
Sure enough, they responded and according to Powell, there might not be the need for further rate hikes this year. As a result, equities have rallied strongly, while the USD has fallen away sharply. With gold and oil still staying strong.
Today we have some data out of Europe including German Employment and Eurozone GDP. With a number of second-tier releases throughout the European session.
We also have the US-China trade talks coming along and there is a chance to hear more of the developments today.
Forex Signal Update
The FX Leaders Team finished yesterday with four winning signals and one in the red, with a number of trades in majors as the USD was very active.
GBP/USD – The pound is holding up strongly, thanks in the most part to a weak USD. We are now looking at a possible test of the highs at 1.3200.
Gold – Active Signal
Gold has rallied strongly since holding the 1300 level. We saw a further push on the USD weakness yesterday. We are now looking for a quick retrace.
EUR/GBP – Pending Signal
The EUR/GBP has bounced off the recent lows and we are short. There is some resistance above, but the stop is getting a bit tight here.
Bitcoin seems to have found a bit of buying interest just above the $3,300 level. As price drifts back to $3,500, this should be where the sellers look to step up again.
As mentioned, there is previous buying interest around the $3,000-200 area, so there is a chance of a sharp spike lower to that point. Still, the longer term trend is clearly to the downside.