News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.



Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Please try again
More View more
Real Time News
  • *Reminder: Weekly Strategy Webinar tomorrow morning at 8:30am EST on DailyFX! A look at the levels heading into #FOMC -
  • Key levels in forex tend to draw attention to traders in the market. These are psychological prices which tie into the human psyche and way of thinking. Learn about psychological levels here:
  • Markets Week Ahead: Euro, Dollar, Gold, S&P 500, Earnings, Inflation Check out @RichDvorakFX's latest market recap and preview plus all the weekly forecasts from the @DailyFXTeam at the link below! Link to Analysis - $EURUSD $SPX #Trading
  • Looking for a new way to trade reversals? One of the most used reversal candle patterns is known as the Harami. Like most candlestick formation patterns, the Harami tells a story about sentiment in the market. Get better with trading reversals here:
  • The non-farm payroll (NFP) figure is a key economic indicator for the United States economy. It is also referred to as the monthly market mover. Find out why it has been given this nickname here:
  • Knowing how to accurately value a stock enables traders to identify and take advantage of opportunities in the stock market. Find out the difference between a stock's market and intrinsic value, and the importance of the two here:
  • US indices have a packed week ahead with earnings from the major technology names, US GDP data due and an FOMC rate decision. With so much on the docket the potential for volatility is heightened. Get your stock market forecast from @PeterHanksFX here:
  • GDP (Gross Domestic Product) economic data is deemed highly significant in the forex market. GDP figures are used as an indicator by fundamentalists to gauge the overall health and potential growth of a country. Learn use GDP data to your advantage here:
  • The Federal Reserve System (the Fed) was founded in 1913 by the United States Congress. The Fed’s actions and policies have a major impact on currency value, affecting many trades involving the US Dollar. Learn more about the Fed here:
  • The US Dollar Index traded higher last week, sustaining its broader uptrend. Conflicting technical signals urge caution, but the directional bias remains skewed to the upside. Get your weekly USD technical forecast from @FxWestwater here:
EUR/USD Weakness to Persist on Hawkish 2016 FOMC

EUR/USD Weakness to Persist on Hawkish 2016 FOMC

David Song, Shuyang Ren,

- Federal Open Market Committee (FOMC) Widely Expected to Retain Current Policy.

- Will the Fed Retain Its Pledge to Further Normalize Monetary Policy 2016?

Trading the News: Federal Open Market Committee (FOMC) Interest Rate Decision

According to a Bloomberg News survey, all of the 104 economists polled forecast the Federal Open Market Committee (FOMC) to keep the benchmark interest rate on hold at 0.50%, but the bullish sentiment surrounding the U.S. dollar may gather pace throughout 2016 should Chair Janet Yellen pledge to further normalize monetary policy over the coming months.

2016 rotation may .

What’s Expected:


Click Here for the DailyFX Calendar

Why Is This Event Important:However, with the 2016 rotation, market participants may pay increased attention to the new voting-members as St. Louis Fed President James Bullard, a central bank hawk, adopts a more cautious tone, and a material shift in the policy statement may dampen the appeal of the dollar as it weighs on interest rate expectations.

Expectations: Bullish Argument/Scenario




Consumer Confidence (JAN)



Consumer Price Index ex. Food & Energy (YoY) (DEC)



Non-Farm Payrolls (DEC)



Improved confidence accompanied by sticky price growth may encourage the Fed to implement higher borrowing costs in the months ahead, and the fresh batch of central bank rhetoric may foster a near-term advance in the greenback should the committee put an increased emphasis on its next interest rate decision on March 16.

Risk: Bearish Argument/Scenario




Advance Retail Sales (MoM) (DEC)



Average Hourly Earnings (YoY) (DEC)



ISM Manufacturing (DEC)



However, slowing outputs paired with subdued wages may push Fed officials to endorse a wait-and-see approach, and the reserve currency stand at risk of facing near-term headwinds should the 2016 committee change its tune and highlight a greater downside risks to its economic outlook.

Join DailyFX on Demandto Cover the Entire FOMC Interest Rate Decision!

How To Trade This Event Risk(Video)

Bullish USD Trade: Fed Stays on Course to Further Normalize Policy in 2016

  • Need red, five-minute candle following the rate decision to consider a short EUR/USD position.
  • If market reaction favors a bullish dollar trade, sell EUR/USD with two separate position.
  • Set stop at the near-by swing high/reasonable distance from cost; at least 1:1 risk-to-reward.
  • Move stop to entry on remaining position once initial target is met, set reasonable limit.

Bearish USD Trade: FOMC Talks Down Bets for Higher Borrowing-Costs

  • Need green, five-minute candle to favor a long EUR/USD trade.
  • Implement same strategy as the bullish dollar trade, just in the opposite direction.

Potential Price Targets For The Release


EUR/USD Daily Chart

Chart - Created Using FXCM Marketscope 2.0

  • The diverging paths for monetary policy casts a long-term bearish outlook for EUR/USD especially as the European Central Bank (ECB) keeps the door open to further embark on its easing cycle, with the pair at risk of giving back the rebound from earlier this month as price & the Relative Strength Index (RSI) retain the bearish formations carried over from December.
  • The DailyFX Speculative Sentiment Index (SSI) shows retail crowd has flipped net-short EUR/USD earlier this week on January 25, with the ratio falling towards near-term extremes as it slips to -1.33 (66% of traders are currently long).
  • Interim Resistance: 1.1052 (November high) to 1.1090 (50% retracement)
  • Interim Support: Interim Support: 1.0380 (78.6% expansion) to 1.0410 (61.8% expansion)

Avoid the pitfalls of trading by steering clear of classic mistakes. Review these principles in the "Traits of Successful Traders" series.

Impact that the FOMC rate decision has had on EUR/USD during the last meeting


Data Released



Pips Change

(1 Hour post event )

Pips Change

(End of Day post event)



12/16/2015 18:00 GMT





December 2015 Federal Open Market Committee (FOMC) Interest Rate Decision


The Federal Open Market Committee (FOMC) finally removed the zero-interest rate policy (ZIRP), with the central bank voting unanimously to lift the benchmark interest rate by 25 basis points to 0.50%. Even though the central bank remains ‘data dependent,’ it seems as though the Fed will stay on course to implement higher borrowing-costs in 2016 as Chair Janet Yellen remains confident in achieving the 2% inflation goal over the policy horizon. The initial market reaction was largely mixed, with EUR/USD briefly climbing above the 1.1000 handle, but the move was short-lived as the pair ended the day at 1.0908.

Read More:

USD/CAD: Just a Minor Setback?

Oil Collapse Driven by Panic; Is CAD at a Policy Turning Point?

WTI Crude Oil Price Forecast: Largest 2-Day Rally since 2008 Lacks Follow through (Levels)

COT-Trend Traders Hold Record Net Short Position in Copper

--- Written by David Song, Currency Analyst and Shuyang Ren

To contact David, e-mail Follow me on Twitter at @DavidJSong.

To be added to David's e-mail distribution list, please follow this link.

Trade Alongsidethe DailyFX Team on DailyFX on Demand

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.