Today we are looking forward for the Fed Fund Rate statement and since there will be no interpretation of any sound bites from Yellen we shall be looking for the same thing that everyone is expecting, just a simple text and number. Most investors and traders like are expecting that the Fed will maintain this rate as it was-at 0.05% and when they will raise it is what everyone don’t know, just speculations. From the economic news trickling in from the NZD isn’t good either and this pair has been moving on a lower low basis with today’s Trade Balance dropping to 117M from last month’s 367M, then there is the effect of the AUD which plummeted today after their CPI dropped to 0.2% from last month’s 0.4%.
With this news always affecting our charts, let’s look at what happened:
Daily Chart Analysis
This pair continues to move sideways at a tight range usually less than the daily average of 75 pips, yesterday it moved 60 pips after that bullish run through from the New York session to the beginning of the European sessions. The technicals are indicative of a probable reversal with price now failing to move down or up through that very strong resistance formed by the 5 months resistance line and the support turned resistance trend line which developed last month. From the last two candle sticks, it seems the pair is ready for a bullish run since they are making a series of higher highs and higher lows.
Fundamentally, the general mood in the market is that the Feds will maintain their dovish state and let the interest rates constant for the moment. The RBNZ will also release its interest rate forecast and analyst forecast that they will maintain it at 2.25% just 3 hours after the Feds have done their job.
4 HR Chart Analysis
Technically speaking this pair is trending lower with prices moving in from the psychologically 0.7 area and now it is trending just below the 0.68 regions. OBV is showing a continues volume reduction and is swinging in from the overbought levels of the stochastics while the middle BB is acting as a temporary support in coincidence with the stronger 5 month’s resistance line which is clear in the daily chart. The slope of the middle BB is also negative and we shall look short at all highs on this time frame only with the perfect indicator combination.
15 Min Chart Analysis
As seen from the charts, the Asian session was very bearish after that short indicator combination at the end of the New York Session. At the moment price has retracted to the 61.8 Fibonacci level and it is forming a good resistance line as observed. We shall look to initiate shorts at the overbought region of the stochastics if price retracts to the 23.6 or 0.0 Fibonacci levels probably in the London session as we wait for the Feds Rate decision.
Verdict: Sell at all highs.