Yesterday market’s reaction to FOMC was quite inactive. After relatively sharp reaction during first minutes, further it was chamber. The overall impression – FOMC retains the intrigue and keeps players in suspense, not refusing from increase of rates in September. Improved unemployment and housing market are detected, still, inflation is growing too slowly. In general, the text of communiqué changed little in contrast to the previous one, but each time the Fed finds at least several words, which allow talking about readiness to increase rates. By the end of the day dollar grew, reflecting improved moods of investors after the session. It should be said that trades’ activity was too low for such event. Probably, there is a factor of started vacation season, when activity falls.
It is difficult to say to what the market will pay more attention today. Considering main events, it is inflation in Germany and US GDP for the 2nd quarter. For the Eurozone weak inflation means probability of widened program of assets buying-out by the ECB, what is a negative factor for euro. US GDP is expected to be considerably better than in the first quarter. Still, strong reaction is improbable. Players know what FOMC members had already at yesterday’s session, so it won’t become a great surprise. After previous day market's balance has shifted towards dollar. Under lack of surprises its slow growth is possible today too.
Now we stay dollar bulls, though it becomes more and more difficult to find entry point and not face surprises. For today we consider euro’s sale in the range 1.0980 – 1.1000, stop at 1.1080, aim at 1.0910 – 1.0930. In case of a pair decrease of more than 30 points from the entry point, rearrange stop at the entry point.
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