{"id":155633,"date":"2019-09-18T09:00:16","date_gmt":"2019-09-18T13:00:16","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=155633"},"modified":"2019-09-18T07:22:58","modified_gmt":"2019-09-18T11:22:58","slug":"fomc-are-markets-ready-for-it","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2019\/09\/fomc-are-markets-ready-for-it\/","title":{"rendered":"FOMC \u2013 Are Markets Ready for It?"},"content":{"rendered":"
September 18, 2019<\/div>
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By <\/strong>Orbex<\/strong><\/a><\/p>\n

The two-day FOMC meeting concludes today, September 18th. At this time, the policy statement and fresh economic projections will be released around 2 pm ET. This is followed by Chair Powell\u2019s press conference scheduled for 2:30 pm ET.<\/p>\n

Reading Between the Lines<\/strong><\/h2>\n

It\u2019s unknown what the Chair will decide to show today, and multiple scenarios are in sight. Will it be the less dovish version from\u00a0the end of July<\/a>\u00a0when he announced that it was not the beginning of a significant easing cycle as opposed to a \u201cmid-cycle\u201d adjustment?<\/p>\n

\u2018As Appropriate\u2019 or \u2018Mid Cycle\u2019<\/strong><\/h2>\n

Will Chairman Powell be more cautious this time and condition everything upon the flow of data and events while committing the Fed to act \u201cas appropriate\u201d? The latter approach was the Chair\u2019s method at a recent moderated panel discussion in Zurich on September 6th when he didn\u2019t mention his previous \u201cmid-cycle\u201d references.<\/p>\n

FOMC and the 0.25bps<\/strong><\/h2>\n

Things are different since that panel appearance. Additionally, it\u2019s not clear that the omitted reference within a tamer setting than a post-FOMC press conference was fully intended. Powell perhaps thought of leaving such guidance for a discussion at the FOMC meeting rather than prejudging the outcome. At this juncture, market watchers believe that Powell will, and it\u2019s necessary to adopt the \u201cmid-cycle\u201d tagline once again. A quarter-point reduction would be the case here. Markets are expecting it. The consensus is almost entirely on board.<\/p>\n

FOMC Aftermath<\/strong><\/h2>\n

The market risks to have Powell giving further guidance in the shape of modest additional adjustments. This is a slippery path that has the potential to harm markets and global growth alike.\u00a0As of early September<\/a>, markets were estimating about five more rate cuts by the end of 2020. Fed funds futures might see three cuts priced shortly, including today\u2019s forecasted rate reduction.<\/p>

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Technical Takeaway<\/strong><\/h2>\n
\"DXY_FX\"<\/a><\/figure>\n

The DXY remains bid, with recent CFTC data suggesting a lightening of long positions in the market from a positioning perspective this gives scope for another leg higher in the DXY as 97.85 acts as support bulls will be targeting a retest of current cycle highs at 99.35 a close above this level will open an immediate assault on the psychological 100 level, the key to this upside development is the current range pivot 98.65. A failure to regain the pivot on a closing basis opens a retest of support at 98.00 a breakdown below 97.65 would open a move to retest current range support at 97.20.<\/p>\n

By <\/strong>Orbex<\/strong><\/a><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

By Orbex The two-day FOMC meeting concludes today, September 18th. At this time, the policy statement and fresh economic projections will be released around 2 pm ET. This is followed by Chair Powell\u2019s press conference scheduled for 2:30 pm ET. Reading Between the Lines It\u2019s unknown what the Chair will decide to show today, and […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-155633","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/155633","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=155633"}],"version-history":[{"count":2,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/155633\/revisions"}],"predecessor-version":[{"id":155645,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/155633\/revisions\/155645"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=155633"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=155633"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=155633"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}