Dollar stands still at record low prices ahead of FOMC deicision

The market awaits the FOMC rate decision which is now broadly expected to be a 100bp cut, revised from 75bp. The British Pound continues to lag behind the Euro in performance as investors still fear that the UK credit market can still turn for the worse.


News and Events:
It remains to be seen whether the Federal Reserve’s attempt to increase liquidity in the market will have any effect on investor sentiment. The market awaits the FOMC rate decision which is now broadly expected to be a 100bp cut, revised from 75bp. The dollar has been relatively stable within the past 24 hours. EURUSD trades now at 1.5790, down from its 1.5904 high early Monday morning.

The British Pound continues to lag behind the Euro in performance as investors still fear that the UK credit market can still turn for the worse in light of what has occurred in the USA. The British Pound dropped 3% against the Euro last week. EURGBP trades now at 0.7856, down slightly from 0.7912, the Monday high.




Today's Key Issues (time in GMT):

11:00 CAD Consumer Price Index MoM FEB 0.30% vs -0.20%
11:00 CAD Consumer Price Index YoY FEB 1.80% vs 2.20%
11:00 CAD Bank Canada CPI Core MoM FEB 0.30% vs 0.10%
11:00 CAD Bank Canada CPI Core YoY FEB 1.20% vs 1.40%

12:30 USD Producer Price Index (MoM) FEB 0.30% vs 1.00%
12:30 USD PPI Ex Food & Energy (MoM) FEB 0.20% vs 0.40%
12:30 USD Producer Price Index (YoY) FEB 6.80% vs 7.40%
12:30 USD PPI Ex Food & Energy (YoY) FEB 2.10% vs 2.30%
12:30 USD Housing Starts FEB 995K vs 1012K
12:30 USD Building Permits FEB 1020K vs 1048K

18:15 USD FOMC Rate Decision Mar-18 2.50% vs 3.00%

21:00 USD ABC Consumer Confidence Mar-16



The Risk Today:

EurUsd has a high risk of a retracement should it break 1.5684, yesterday’s low. This would open the door to 1.5346, the 38.2% of the last major bull run beginning on February 8th. On the upside, the upper trend of the channel falls at 1.6000, a major psychological level for the pair.

GbpUsd didn’t quite have enough strength of a full 61.8% retracement to 2.0476. The pair did perform a Winnipeg, bouncing off the 1.9974 support level, and currently trading above 2.0125.

UsdJpy the next major target in this massive move down is 79.72, a level not seen since April of 1995. For now, the pair stands a chance to get back into its downward channel, and retrace above 98.40.

UsdChf very bearish situation. The pair is struggling to get above 0.9950 and the downside is wide open. Anything below 0.9640 is extremely bearish.


Resistance and Support:




By James Brandt - ACM Advanced Currency Markets, Geneva, Switzerland