US Dollar Price Action Setups Ahead of FOMC: EURUSD, USDJPY, GBPUSD

Talking Points:

– Today at 2PM ET brings the March rate decision out of the FOMC. A hike at today’s meeting has long been expected, and it would be surprising if no adjustments are made. More pressing, however, is the Fed’s tolerance for rate hikes for the rest of 2018. If we see a signal for four hikes this year as taken from the Dot Plot Matrix, a string of short-term strength may develop in the US Dollar; and this could eventually become attractive for selling USD into the longer-term bearish trend.

– We look at three Dollar-pairs below in EUR/USD, USD/JPY and GBP/USD, each with varying degrees of attractiveness for short-side USD plays. EUR/USD may have a deeper retracement in store before the longer-term trend is ready for resumption, while USD/JPY continues to tangle around long-term support. GBP/USD, on the other hand, appears to have already gotten started with that bullish trend resumption, and tomorrow’s Bank of England rate decision will likely keep the pair on the move.

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