Elliott Wave structure is pointing for higher USD todays, but Fed decides

Gregor Horvat Wavetraders

It’s finally Wednesday, likely the most important day of the week as we await the Fed’s decision. Expectations are for a 25-basis-point cut, but the real focus will be on the press conference and whether they deliver hawkish remarks. As you know, the US economic projections for next year are quite strong, so there may not be a need to cut rates in upcoming meetings, especially considering inflation remains well above their 2% target.

If the Fed sounds hawkish, we can expect the dollar to recover, and from an Elliott wave perspective, this seems likely after a strong rebound from 105.40, with move out of the corrective channel in five waves, so after some slowdown now ahead of the Fed, there’s a chance we’ll see continuation higher into a fifth wave. On the flip side, major currencies like the euro, Aussie, and Swiss franc could then drop.

What we should also watch closely are US yields and stocks. I think stocks could move lower, testing the downside of their recent ranges, especially the S&P 500, if Powell delivers a hawkish tone.

Get Full Access To Our Premium Elliott Wave Analysis For 14 Days. Click here.

Author

Gregor Horvat

Wavetraders

Experience Grega is based in Slovenia and has been in the Forex market since 2003.

EUR/USD flirts with daily highs, retargets 1.1900

EUR/USD regains upside traction, returning to the 1.1880 zone and refocusing its attention to the key 1.1900 barrier. The pair’s slight gains comes against the backdrop of a humble decline in the US Dollar as investors continue to assess the latest US CPI readings and the potential Fed’s rate path.

GBP/USD remains well bid around 1.3650

GBP/USD maintains its upside momentum in place, hovering around daily highs near 1.3650 and setting aside part of the recent three-day drop. Cable’s improved sentiment comes on the back of the Greenback’s irresolute price action, while recent hawkish comments from the BoE’s Pill also collaborate with the uptick.

Gold clings to gains just above $5,000/oz

Gold is reclaiming part of the ground lost on Wednesday’s marked decline, as bargain-hunters keep piling up and lifting prices past the key $5,000 per troy ounce. The precious metal’s move higher is also underpinned by the slight pullback in the US Dollar and declining US Treasury yields across the curve.

Crypto Today: Bitcoin, Ethereum, XRP in choppy price action, weighed down by falling institutional interest

Bitcoin's upside remains largely constrained amid weak technicals and declining institutional interest. Ethereum trades sideways above $1,900 support with the upside capped below $2,000 amid ETF outflows.

Week ahead – Data blitz, Fed Minutes and RBNZ decision in the spotlight

US GDP and PCE inflation are main highlights, plus the Fed minutes. UK and Japan have busy calendars too with focus on CPI. Flash PMIs for February will also be doing the rounds. RBNZ meets, is unlikely to follow RBA’s hawkish path.

Ripple Price Forecast: XRP potential bottom could be in sight

Ripple edges up above the intraday low of $1.35 at the time of writing on Friday amid mixed price actions across the crypto market. The remittance token failed to hold support at $1.40 the previous day, reflecting risk-off sentiment amid a decline in retail and institutional sentiment.