As expected, the FOMC voted to raise the target range on federal funds by 25 bp to 1.00% to 1.25%, with a midpoint of 1.125%. The vote was 8-1, with Minneapolis Fed President Kashkari dissenting in favor of no change. The Fed announced it would begin cutting its holdings of bonds and other securities this year.
In line with our expectations, the dot plot leaves the median of participants’ votes for the target fed funds rate at year-end 2017 at 1.375% and at year-end 2018 at 2.125%.The median dot for 2019 fell to 2.938% from 3.0%, while the longer run dot was unchanged at 3.0% for the fifth time.
The statement mentioned continued strengthening in the labor market and a moderate rise in economic activity. It acknowledged that jobs gains have moderated but “have been solid”. It mentions a pick-up in household spending with continued expansion in fixed investment. These are not the dovish proclamations for which many investors had been looking. Likewise, the Committee expects “labor market conditions will strengthen somewhat further” and inflation will stabilize around the Committee’s 2% objective over the medium term, even if they expect inflation to remain somewhat below 2% in the near term. The statement repeated that the Committee is monitoring inflation developments closely.
Our previous EUR/USD short was closed earlier today at the entry point. We have opened another EUR/USD short at 1.1235 after the Fed decision.
FOREX – MAJOR PAIRS:
FOREX – MAJOR CROSSES:
How to read these tables?
1. Support/Resistance – three closest important support/resistance levels
2. Position/Trading Idea:
BUY/SELL – It means we are looking to open LONG/SHORT position at the Entry Price. If the order is filled we will set the suggested Target and Stop-loss level.
LONG/SHORT – It means we have already taken this position at the Entry Price and expect the rate to go up/down to the Target level.
3. Stop-Loss/Profit Locked In – Sometimes we move the stop-loss level above (in case of LONG) or below (in case of SHORT) the Entry price. This means that we have locked in profit on this position.
4. Risk Factor – green “*” means high level of confidence (low level of uncertainty), grey “**” means medium level of confidence, red “***” means low level of confidence (high level of uncertainty)
5. Position Size (forex)– position size suggested for a USD 10,000 trading account in mini lots. You can calculate your position size as follows: (your account size in USD / USD 10,000) * (our position size). You should always round the result down. For example, if the result was 2.671, your position size should be 2 mini lots. This would be a great tool for your risk management!
Position size (precious metals) – position size suggested for a USD 10,000 trading account in units. You can calculate your position size as follows: (your account size in USD / USD 10,000) * (our position size).
6. Profit/Loss on recently closed position (forex) – is the amount of pips we have earned/lost on recently closed position. The amount in USD is calculated on the assumption of suggested position size for USD 10,000 trading account.
Profit/Loss on recently closed position (precious metals) – is profit/loss we have earned/lost per unit on recently closed position. The amount in USD is calculated on the assumption of suggested position size for USD 10,000 trading account.
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By GrowthAces.com – Daily Forex Trading Strategies