This is our view for FOMC today, please do your own research and analysis to make an informed decision on the markets. It is not recommended you try to trade the event if you have less than 6 months trading experience and have a trusted risk strategy in place. The markets are extremely volatile and can cause aggressive swings in price.
We’ve seen a bit of a decline today as we suggested in yesterdays end of day analysis. We were looking for the immediate support to hold and if it broke the level below, which is yet to be targeted. We will use the 1H chart today with the 4H levels as these are more applicable in volatile markets, like the ones were seeing at the moment. So, we have support below as suggested around the 1830-35 region and immediate resistance above which is now the 1855-60 level. Excalibur has given us an indication of a move, however, we would like to trade this using the extreme levels for FOMC and rather stay out of the immediate levels while there is a chance they can move it aggressively.
As always, we will trade this with two scenarios in mind.
Scenario 1:
The push the price up into that 1855-60 level and we see resistance there, as long as this level doesn’t break we see this as an opportunity to short the market back into the 1830-35 region as the first target and below that the 1820 level.
Scenario 2:
This one would be ideal for us. They push the price down into the 1830-35 and potentially below that into 1820. If we see support formed here, we feel this would represent an opportunity to then long the market back up into 1850, 1865 and above that 1870 price points.
It’s a short on today and to be honest we don’t think we will get involved in trading the FOMC release. We would rather wait for them to take the price to where they want to buy or sell it and then we’ll look to get in for a longer term position. If you’re new to trading, don’t think you’ll get rich of these events, they take a lot of practice and experience to trade.
The trade will always come, most of the time its once the market has moved to a certain point or level.
In summary:
Look for the lower support regions to go long or the higher resistance levels to go short. We’re below 1850 but we must not close the daily below the 1830-35 level.
Hope this helps in preparation for the week ahead, we will update you as we go along as we usually do. Please do support us by hitting the like button, leaving a comment and giving us a follow. We’ve been doing this for a long time now providing traders with in-depth free analysis on Gold, so your likes and comments are very much appreciated.