Daily trading Strategy

August 8, 2006

The Fed gathered today for 18th Federal Open Market Commitee (FOMC) meeting, the result of which would be an increase or a pause in a year long interest rate hike which raised the borrowing cost from 1% to 5.25%. The Fed will announce its policy decision at 2:15 p.m. EDT .
If the Fed couples its decision with a hawkish statement that leaves the door open for future rate increases, the dollar may rally as traders unwind bets against it.
However, if the Fed decides to pause or even wrap up its cycle of increasing the interest rates this could generate even more selling pressure for the dollar which could decrese to 1.3000 resistance level.

Today’s Strategy: Look for a price breakout at 18:15 GMT . Place a BUY order for EUR/USD 1.2847 (10 pips above the 0.382 fibonacci level) STOP at 1.2834 LIMIT 1.2873. Also place a SELL @ 1.2826 STOP 1.2841 LIMIT 1.2796.
 

Posted by forexsource under Daily Trading Strategy | Comments (1)