FOREX PAIR TO TRADE ON FOMC MEETING ON 18Th SEPTEMBER 2019
Market is already expecting 25 bps point cut in interest rate on 18th September, however, it will lot depend on statement, how FOMC will going to consider future rate cuts, so there are three scenarios first if the rate cut doesn’t happen on this meeting, initial movement of dollar will be on upside ,however if in the statement FOMC clearly say about future rate cuts than again it is going to be consider as negative news for dollar , second if rate cut happens in this meeting and FOMC also says that future rate cut will be depend on data to come in positive tone, it will consider as positive news for dollar because market is already priced in rate cut on this meeting & the third scenario is if FOMC cut interest rate and also talk about future rate cut, well then it can really slide dollar on downside
Now on technical ground lets look at the dollar index chart first
Dollar index has been in rising in upward channel from last year after touching the resistance line of that channel it is finding the support on immediate basis around 98.00 level , this immediate support is very crucial because if it breaks this support the next crucial support is around 96.60 level, given the fact bigger news like FOMC meeting can break this kind of support, however, if it doesn’t we can expect it can touch upward channel again.
Out of all major chart I find usd cad is better chart to trade lets look at this
If we look at USD /CAD there are four resistance around same price zone approximately 1.3330 to 1.3365 first resistance line coming from top, second from middle, third was a horizontal level which USD cad considered many times before it breaks on upside and last or fourth one is the previous support which can be considered as resistance now. if prices reach to these level, it can be good shorting candidate also considering crude oil prices recent jump might help to strengthen the Canadian dollar, if one short around 1.3330 one can have stop loss around 1.3400, that’s around 70 pips and can expect 150 pips target on the downside.
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