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Video: EURUSD and NZDUSD Better FOMC Trades than GBPUSD

Video: EURUSD and NZDUSD Better FOMC Trades than GBPUSD

2014-09-17 04:05:00
John Kicklighter, Chief Currency Strategist
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Talking Points:

• A bounce in capital markets and slip from the Dollar shouldn't be seen as a preemptive Fed move

• Critical in the upcoming FOMC decision is whether the Fed tries to reconcile the market's expectations

• Dollar volatility is likely, but an appreciation of risk trends and subsequent event risk is important

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Have volatility levels been rising in anticipation of the upcoming FOMC decision or is it a more systemic shift in circumstances? We will soon find out. A rise in activity levels for the FX and financial markets that is largely centered on the upcoming policy decision (along with events like the Scottish Referendum and ECB TLTRO stimulus) suggests we can return to unproductive and dangerous complacency with an outcome that supports the status quo. Then again, the focus could also ensure this event is an agent of far more pervasive change should there be an effort to correct imbamances in perception. In today's Trading Video, we look at the heavy event risk ahead and consider the different aspects for a reaction from the Dollar and risk trends.

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