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FOMC minutes preview: What to expect of EUR/USD?

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 17, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    The Federal Open Market Committee will publish the minutes of its Jan 26-27 meeting, when the Fed decided to leave rates on hold after raising in December.

    Market’s focus will be on the language, as investors search for clues on whether the Fed could raise rates again in a meeting or two amid growing turmoil in global markets. In the last statement, the Fed removed its assessment on the balance of risks. Then, Chair Yellen acknowledged last week that “foreign economic developments, in particular, pose risks to U.S. economic growth”.

    While minutes are unlikely to provide clear hints at Fed’s next move, so in the absence of surprises, the effect on the US dollar might be limited and short-lived.

    What to expect of EUR/USD?

    As for EUR/USD, the pair was trading near weekly lows at the 1.1140 zone heading into the release. Should the dollar strengthen on the back of the minutes, EUR/USD could find next supports at 1.1085 (Feb 8 low), 1.1055 (200-day SMA) and 1.0965 (100-day SMA).

    On the flip side, resistances in case of bounces are seen at 1.1210 (10-day SMA), 1.1249 (Feb 15 high) and 1.1333 (Feb 12 high).
    For more information, read our latest forex news.

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