Today was #FOMC! I'm Sure most of us had same experience on BLACKBULL:WTI and $OANDA:XAUUSD. I Just wanted to write about What is #FOMC and It's impact on #WTI, #Gold and #USD, Maybe somebody has lots of questions about that, so I try to do my best regarding captioned subject. The Federal Open Market Committee (#FOMC) plays a crucial role in shaping monetary...
If you've ever wondered how the U.S. monetary system functions and who runs the show, keep reading. In this article, we will break down the structure of the Federal Reserve System and help you understand how it operates. 🏦 The Federal Reserve System, often referred to as the Fed, is the central banking system of the United States. It was created in 1913 by the...
What is FOMC, and what does it do? FOMC stands for Federal Open Market Committee. It's a group of people who work for the US government and makes decisions about the country's money. They decide how much money should be in circulation and how much it should cost to borrow money. How does FOMC affect the forex market? FOMC's decisions can affect the forex...
The FOMC announced another 50bps (0.50%) Interest Rate increase to 4.50% which has lead to short term downside for gold as an initial reaction. The question for many remains. Why does gold drop when interest rates rise? There are a number of reasons, but here are the top 5… #1: Investors look elsewhere Higher interest rates can make other investments, such...
We had the CPI come our better than expected (7.1%) versus 7.3% expected. This means finally inflation is decelerating at an accelerating rate which is good for the markets. However, today with the FOMC they are expecting a 50 bps hike or 0.5% rise. Just a reminder in simple terms Interest rates is the amount of money (expressed as a %) that a lender...
The Federal Open Market Committee (FOMC) is set to meet next week, and investors are eagerly anticipating the outcome of the meeting. Bank of America Global Research has discussed its expectations for the meeting, saying that it expects the Fed to raise its target range for the federal funds rate by 50bp in December to 4.25-4.5%. According to Bank of America, the...
Time – 3 Nov 5am AEDT / 6PM GMT (Jay Powell speaks at 05:30 AEDT) Central bank meetings are just so important to sentiment and market structure – when we’re trading a major market theme, such as inflation and rising interest rates, this is the market’s chance to mark-to-market policy changes and how the collective in the bank guide our expectations for future...
Any counter-trend trader and the active trader will be tempted to short this candle formation. However, a matured trader will hold his horses and check if there's any upcoming Economic Data Release. You will see that there's one that's going to happen in less than 45mins time. Remember, you are a trader, not a gambler.
As individuals, we face decisions every day that implicate saving money for a future use or borrowing money for consumption. If we want to make an investment, one important task for us is the analysis of transactions with present and future cash flows. When we place value on any asset, we are trying to determine the worth of a stream of future cash flows. Money...
Generally, price action traders believe that price discounts every factor that may influence a security's price. But you should Not Ignore Major (High Impact) Economic News Announcements like: Interest Rate decisions, Non-Farm Payroll, FOMC, Crude Oil inventories, and so on... REASON: - If you did take a trade in line with the result of the economic news...
I was taught in undergrad that adding to the money supply is inflationary . The logic was, you print more bills; the existing currency gets diluted in buying power. Following the ‘Crises of 2008’ the Fed launches Quantitative easing and purchases long term securities increasing the money supply and lowering rates. This activity would result in more investment...
How effective are Fed's monetary policies and tools? Fed has three simple goals- Grow GDP, keep inflation rate steady and keep the unemployment rate low. Some argue that Fed's perceived power over the market was exposed during several occasions- #1. During the 2008 in the midst of sub-prime mortgage crisis, the market continued to plunge despite the Fed's...
The dollar peaked and broke down on October 1, 2019 10pm as Fed Fund Futures indicate a jump in probability from 39% to 62%. This was a good signal to go long EUR and buy the pullbacks on an hourly timeframe. Probabilities of a 150-175 Target Rate on October 30,...
Many people who trade in the financial markets, especially those who engage in foreign exchange trading, do not pay attention to a very important aspect in trading that can cause great losses or reduce large profits. What I am talking about is slippage, which is the gap between the forex price we ask and the price we get in the execution of an FX trade. There...