Fed projections & Powell's comments drive market reactions. Our technical analysis covers US indices, gold, FX, and oil, highlighting key levels & potential trading opportunities post-Fed and BoJ meetings.
Fed raised the prospect of stagflation
The Fed maintained its Fed funds rate at 4.25%-4.50% as expected, but in the latest “dot-plot” of economic projections, it revised its GDP growth forecasts downwards and increased its revisions to inflation and unemployment projections.
Fed Chair Powell, in his press conference, stated that the base case remains for tariffs to have a transitory impact on inflation that sparked a rally across the major US stock indices that erased prior losses seen on Tuesday. Despite yesterday’s gains, all four major US stock indices, S&P 500, Nasdaq 100, Dow Jones Industrial Average, and Russell 2000 remained below their respective 200-day moving averages.
Gold (XAU/USD) ignored the risk-on behaviour in US stock markets and continued on its upward trajectory to print another fresh all-time intraday high of US$3,052 yesterday amid rising stagflation risk.
The US dollar was mixed among the major currencies while the US dollar was the worst performer against the Japanese yen as the USD/JPY’s rally failed to break above 150.50 resistance ex-post BoJ monetary policy decision yesterday.
Meanwhile, prior two days’ of gains seen in the GBP/USD has started to show potential exhaustion conditions below the 1.3025/3040 resistance ahead of today’s BoE monetary policy decision.
The latest intraday technical analysis on US Wall Street 30, US Nas 100, Hong Kong 33, Japan 225, Germany 30, EUR/USD, GBP/USD, AUD/USD, USD/JPY, Gold (XAU/USD), and West Texas Oil can be found in our YouTube video above.
