EURUSD Market Analysis-Fed Interest Rate Decision What To Expect

Tomorrow the US will be holding a very important economic event, the Fed Interest Rate Decision, Forecast: 3.25% Previous: 2.50%, will be one of the highest volatility events that we will see this year in the market aside from other US interest rate decisions, as it will bring enormous shape to the market. A 0.75% rate increase is expected though a 1.00% rate increase is possible, so is a 0.50% increase. This will affect stocks, bonds, foreign exchange currencies, cryptocurrencies just to name a few, and of course the US economy will be majorly affected. The US aims to fight inflation by increasing interest rates on lending, this includes mortgages and credit. This will affect the economy further by weakening demand in the housing market and increasing supply, this in turn will cause housing market prices to fall over the next year or so, it is possible to see a real estate market crash furthermore. The canadian core CPI report today showed a decrease in inflation month over month and year over year, weakening the loonie but being beneficial for stocks. Putin has recently stated that "the west is looking to weaken and destroy Russia", Putin further stated, "Russia to take necessary steps to defend sovereignty". Putin also stated, "military operations remain the same". After the speech from the Russian leader the EURUSD rate fell 50 pips while the US dollar rose.

From a technical perspective EURUSD has had trouble staying above the 4 hour 100 sma while still also beneath the 200 sma. It was holding above the 100 sma yesterday but during the New York session this morning fell beneath once again. The 4 hour RSI has recently fallen under 35 and it is possible that the pair can become oversold soon. Today the Euro US pair saw flatlining movement and stayed within a 10 pip range during the entire asian session and has only started to move after Putin's speech an hour before the London session opening. The MACD 10 day EMA holds below the 30 day EMA and has been showing some bearish momentum after Putins speech. Before the speech the histogram was showing some bullish momentum but has fallen back to bearishness for the time being. It is possible for the euro to see some bullishness later on but be weary of the US Fed rate decision. The 4 hour RSI has not been oversold since August 22nd. Right now I am staying neutral on the EURUSD currency pair. I am not seeing any potential opportunities that stand out today, perhaps after the news tomorrow we can see some oversold or overbought opportunities to speculate on. The US Fed interest rate decision news will be released at 11:00 am GMT-7 pacific standard time.EEUR/USD
Ilyas Khan Top1 Markets