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.

0

Notifications

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

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Bearish
Oil - US Crude
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Mixed
Gold
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
GBP/USD
Bearish
USD/JPY
Bullish
More View more
Real Time News
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 97.38%, while traders in EUR/GBP are at opposite extremes with 65.20%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/WGk95Bnjx5
  • Commodities Update: As of 16:00, these are your best and worst performers based on the London trading schedule: Gold: -0.45% Oil - US Crude: -0.63% Silver: -1.11% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/RvLy6xA9Is
  • Forex Update: As of 16:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: -0.06% 🇯🇵JPY: -0.15% 🇬🇧GBP: -0.22% 🇨🇦CAD: -0.32% 🇦🇺AUD: -0.38% 🇪🇺EUR: -0.43% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/MZIiNOFxXu
  • Hey traders! Wrap up your week with a market update from @DailyFX Chief Strategist @JohnKicklighter 👇 https://t.co/DHufbBKbDu
  • Canadian PM Trudeau says Canada purchasing 20 million vaccine doses from Astrazeneca -BBG
  • Indices Update: As of 16:00, these are your best and worst performers based on the London trading schedule: US 500: 0.26% France 40: 0.03% Wall Street: 0.02% FTSE 100: -0.06% Germany 30: -0.06% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/jByk8LUAt6
  • UK Government Official says either outcome is possible on Brexit
  • UK Government Official says if gaps in fisheries and level playing field are bridged, the EU's more constructive attitude will need to be translated into more realistic positions in the days to come
  • Big headline that says the EU has informed the UK that it must commit to some key demands in next week's trade talks if there is progress before the October deadlines. That said, I don't think this is a particularly new refrain between those two. It's the clock that matters
  • RT @Tams707: #USDZAR tests trendline resistance. Potential breakout in play? https://www.dailyfx.com/forex/market_alert/2020/09/25/South-African-Rand-Price-Forecast-USDZAR-Breakout-Potential-Brewing-LiveEdu-TDC.html
The Fed Finally Hiked Rates. Now what for the Dollar?

The Fed Finally Hiked Rates. Now what for the Dollar?

2015-12-20 18:25:00
David Rodriguez, Head of Product
Share:

The Fed Finally Hiked Rates. Now what do we Watch for the Dollar?

Fundamental Forecast for the US Dollar: Bullish

- US Federal Reserve Hikes in most Telegraphed Policy Change of past Decade

- The Dollar was supposed to fall in December and didn’t. Does it rally in January?

- See what separates top traders from the rest in the Traits of Successful Traders Series

The US Federal Reserve finally raised interest rates in what was likely the most telegraphed monetary policy change in the last decade. Yet the Dollar finished somewhat lower all the same. Now what?

Volatility is likely to fall considerably into the final two weeks of 2015, and as such our focus for this “weekly” forecast will be on market price action through the beginning of the New Year. And in that sense it seems Dollar price action could be fairly straightforward—the narrow focus on the future of Fed interest rate policy will make the USD especially sensitive to key economic data releases and Fed speech.

In raising interest rates at their recent meeting, Fed officials likewise predicted that they would vote to increase rates by approximately 100 basis points further through 2016. This in itself is perhaps not especially surprising; it suggests that they would raise interest rates by 25 basis points once per quarter. Yet the fact that this is considerably above current market forecasts does raise eyebrows.

According to Fed Funds futures and Overnight Index Swaps, traders predict that the Fed will raise rates by approximately half as much as the Fed itself predicts for 2016. The difference is slightly less stark when compared in absolute terms: markets predict 50bps to the Fed’s 100bps. But in a world of near-zero and negative interest rates across other major global currencies, the difference between these estimates could make for considerable volatility in the New Year.

We’ll need to wait until January to get the next major economic data out of the US, and in the meantime it will be important to keep in mind that market liquidity is likely to remain low. Volatility remains unlikely into year-end, but illiquid conditions can make for exaggerated intraday price swings and do represent financial risk. - DR

--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com David specializes in automated trading strategies. Find out more about our automated sentiment-based strategies on DailyFX PLUS.

Contact and follow David via Twitter: https://twitter.com/DRodriguezFX

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

DISCLOSURES