Based on CME Fedwatch Tool, market attaches a 96.3% of a 25 point rate hike at the coming June 2018 meeting. Another 25-point hike is highly expected in September but a total of 4 hikes or 100 points by end of year cannot be ruled out
This post looks at DXY analysis from a bullish and bearish angle. It might be confusing but I am merely point out how Dollar bulls and bears could justify their point of view. My unqualified observation: DXY could potentially go much higher. Maybe crazy enough to go back to 100 by end of this year.
4-charts. Dot Plot shows FOMC meeting participants’ assessment of monetary policy. Rate hike odds implied from Fed Fund Futures trading.
Screencaps of rate hike probabilities as well as FOMC Dot Plot taken off CME FedWatch Tool. In addition, a list of 3 meeting outcomes that could qualify as a shock to the market i.e. high impact news.
Price performance based on this chart of SiMSCI shows that the last four weeks, only market sentiment and chart level matters. Did any fundamentals change in 4 weeks? Fear driven correction, then V-shaped rebound absent any meaningful narrative. Time more than even to pay attention to fundamentals.
This is a post-CNY update with a look at CME odds of a March rate hike (83%). Additionally I take a closer look at JP225 and SG30. JP225 is clearly the weaker leg in the correction and their relative performance suggests JP225 has more to lose. For SG30, recall that 399 is a strong level to test.
Chinese New Year is coming so there will be a 1-2 week period where a significant segment of traders go away. Low volume environment could lead to melt-up or melt-down easily (see green zone). Moving average suggest 13-week ema could become potential resistance. Could see pinball action as market fights.