The FOMC minutes are up for release!
Could this mean a continuation of the USD/CHF selloff or a reversal?
Before moving on, ICYMI, yesterday’s watchlist checked out AUD/USD’s trend after a less dovish RBA statement. Be sure to check out if it’s still a valid play!
And now for the headlines that rocked the markets in the last trading sessions:
Fresh Market Headlines & Economic Data:
U.S. announces sanctions on Russia’s crypto exchange
Bond yields tick higher while equities dip on hawkish Fed commentary
FOMC member Brainard: Rate hikes and rapid balance sheet runoff needed
Deutsche Bank becomes first of its peers to project U.S. recession
Asian Development Bank cuts Chinese GDP forecast to 5.0%
Shanghai lockdown to continue until everyone is tested for COVID-19
API crude oil inventories rose by 1.08 million barrels
New Zealand ANZ commodity prices up by another 3.9%
New Zealand GDT auction revealed 1.0% slump in dairy prices
Chinese Caixin services PMI tumbled from 50.2 to 42.0 vs. 49.6 forecast
Upcoming Potential Catalysts on the Forex Economic Calendar:
Canadian Ivey PMI at 2:00 pm GMT
U.S. Treasury Secretary Yellen to give a speech at 2:00 pm GMT
EIA crude oil inventories at 2:30 pm GMT
FOMC meeting minutes at 6:00 pm GMT
Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️
What to Watch: USD/CHF
This pair is hanging out at the very top of its descending channel on the hourly chart, and technical indicators are pointing to another leg lower.
Will sellers return right here?
The 100 SMA is below the 200 SMA to confirm that the selloff is more likely to resume than to reverse while Stochastic is in the overbought zone. This suggests that buyers are exhausted and willing to let sellers to take over.
In that case, USD/CHF could tumble back down to the bottom of the channel or at least until the swing low near the .9200 mark.
Just be careful since dollar bulls have been charging after a formerly dovish FOMC member, Lael Brainard, dropped some hawkish beats in her latest speech. She mentioned that it would take a combination of rate hikes and a rapid balance sheet runoff to bring monetary policy back to neutral levels.
This sets the stage for a potentially upbeat FOMC minutes to be printed in the upcoming New York session. Recall that the Fed hiked rates by 0.25% during their meeting, and the transcript of their discussion should have some clues on their next moves.
