Markets Move Sideways, Await Fed’s Decision
26 July 2022
Monday’s trading started with mild optimism, but unfortunately major indices ended their sessions on local lows.
Changes were really low and we can’t say they were extremely significant. The DAX, for example, stayed inside of a small pennant formation which started at the second half of last week. In general, there is still hope for a breakout to the upside.
EURUSD didn’t move either. Tuesday starts around the same levels seen consistently since July 19th , with the price oscillating around 1.022, moving 60 pips in both directions. Even last week’s ECB didn’t change that despite the fact that the European Central Bank’s hikes were larger than expected.
Speaking of hikes. Today the FOMC is in a meeting that will most probably result in a rate hike on Wednesday. That event will likely introduce a lot of momentum and volatility to the sleepy charts that we’re seeing now.
Otherwise, today’s calendar is not really busy. The main data is the CB Consumer Confidence report from the US, which will be published in the early hours of the American session. The number 97.3 is expected, which would be a small decline from the previous print of 98.7.
One of the biggest gainers this week is oil. On the Brent chart, we can see that traders are trying to create an inverse head and shoulders pattern, which would be a good base for a bigger rise. In order to get a proper buy signal, we’d need to see the price above the 109 USD/bbl, which is not that far away from now.
More and more companies are publishing their results for the second quarter. Today, it will be for example Microsoft, Alphabet, Visa, Coca-Cola or McDonald’s. Some of those will be published after the session, so for the results on the charts you’ll have to wait until tomorrow.