EUR/USD, GBP/USD and USD/JPY Ahead of the FOMC Risk

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EUR/USD, GBP/USD and USD/JPY Ahead of the FOMC Risk

Today, traders will be monitoring the FOMC monetary policy decision and press conference for clues on when the next rate hike might be. It is expected to be mid-2015, and if there are hints of a possibly earlier hike, the USD can strengthen further. For now, we are seeing USD consolidate in the EUR/USD, GBP/USD and USD/JPY pairs.

The EUR/USD is holding below 1.30. If price can push above 1.30 after the FOMC risk, the pair is likely in consolidation/bullish correction mode. But we should limit the bullish outlook to 1.31-1.3110, or at most 1.3220 for now. The GBP/USD is already in bullish correction, reflecting GBP-strength this week. If price can push above 1.64 and a falling trendline from the 1.7191 high on the year, then GBP/USD might be in consolidation/correction with upside toward the 1.67 handle. Finally, USD/JPY is consolidating but threatening a bullish continuation. If price can push above 107.40, we should be in bullish continuation with 108, and 108.96-109 in sight. A failed bullish attempt would hint at consolidation, but with the JPY so weak, we should probably limit the USD/JPY bearish outlook to 106.

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Fan Yang has been a professional forex trader and analyst since 2007. He specializes in technical analysis and has a Chartered Market Technician designation since 2011. He was the chief technical strategist at CMSFX He was also the founder and chief currency strategist at FXTimes Over the years, Fan has not only been a trader and analyst but also an educator. As a proponent of both technical and fundamental analysis in trading, Fan advocates simplicity and discipline as key factors in making trading decisions when faced with so many "clues" and "signals". Currently Fan Yang is the chief currency analyst and webinar instructor at forexminute.com.