Nearly 24 hours after FOMC last night, CME Fedwatch Tool is showing collapse in rate hike probability for rest of this year.
We are looking at increase in expectation of Fed rate hikes this year 2019 versus just last week based on CME Fedwatch Tool. Just last week market was looking at virtually no hike and odds of a rate cut but now we are back in 2-hikes territory.
Despite the small numbers involved, Fedwatch tool now indicates possibility of two rate hikes in 2019 and no cut in the first half of the year. This is a hawkish swing from just 7 days ago.
DJI, USD have reversed, are downtrending. For my own action, I look for DJI resistance followed by forex pairs to short the USD.
Odds of further Fed hikes in 2019 dinimished to virtually zero based on CME Fedwatch Tool. DXY reinforces this with down trend price action.
I am banking on XAUUSD to follow a price pattern that USDSGD printed earlier this year. If the same happens, we have a long setup.
Straightforward EURUSD short would be easier to manage and more exciting. Should there be reversal, the wedge is an early indication.