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EUR/USD binary signal - FOMC Monetary Policy Meeting - 21 Mar 2018

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Expiry Time: 
21:00 GMT
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The much hyped about monetary policy meeting will be held today by the U.S. Federal Reserve. The two-day meeting concludes today with the release of the monetary policy statement followed by a press conference from the newly appointed Fed Chair, Jerome Powell.

The FOMC is expected to vote for a 25 basis point rate hike at today's meeting. This would effectively bring the U.S. short term fed funds rate to 1.50% - 1.75%.

The futures markets have currently assigned more than a 90% probability for the rate hike at today's meeting. Besides the rate decision, officials at the FOMC will also be giving their individual projections on interest rates, also known as the dot plot.

Economic projections for the year and the year ahead will also help investors to understand where the Federal Reserve is going with interest rates. For the moment, the markets expect to see the Fed hiking rates two more times this year.

This is in line with the Fed's projections given at the December FOMC meeting. With the rate hike today being already discounted by the markets, focus shifts to the forward guidance by way of the dot plot, the economic projections and the press conference as well.

The positioning in the U.S. dollar therefore remains somewhat volatile heading into the FOMC meeting today. The recent downtick in the economic indicators suggests that the U.S. economy might be losing the growth momentum seen in the first two months of the year.

Based on the above, today's binary signal is EURUSD. The currency pair was seen giving up the gains from Tuesday. We expect this volatility to continue but the bias remains to the downside. Therefore, we are looking for daily PUT options in EURUSD at 1.2300 for a 21:00 GMT expiry time.

We expect to see a modest retracement to this level before the currency pair eventually close lower on the day.

binary options signal eurusd 21 mar 2018

Disclaimer: The article is written for informative purposes only and it is not financial advice. The author does not have any position in the currency pairs mentioned, and no plans to initiate a position. He wrote the article himself and expressed his own opinions. Readers should not treat any opinion expressed by the author as a specific inducement to make a particular trade or follow a particular strategy, but only as an expression of his opinion. All risks and coasts associated with online trading are your responsibility.