After the recent US CPI data release, USD has turned weak for a while and then slightly turn strong again in the last few trading days. Next week, we will have FOMC Interest Rate Decision and ECB Interest Rate Decision again in the same week.
The FOMC Interest Rate decision will be on 27 July. The consensus now is expecting Fed will raise 0.25% to 5.50%. Although the last CPI has indicated that inflation is slowing down, but then all the recent earnings from US500 companies beats most of the analyst’s estimates. It does not look like the economy is really slowing down. Fed Chairman Jerome Powell might re-iterate his statement again that the interest will hold “higher and longer”. Furthermore, August does not have an FOMC meeting and the next one will be in September. This is an important session for them to repeat their position on interest rates to the market.
On another side, the ECB interest rate decision will be on 27 July too. The Europe CPI YoY is still at 5.5%, which is a lot higher than the US. The consensus now is they will rise from 0.25% to 4.25%.
Another two economic data release that we need to take note of is Q2 GDP and Core PCE. Q2 GDP will be on 27 July and Core PCE will be on 28 July. The Q2 GDP will give the market an indication that whether the US economy is really slowing down while for Core PCE, it is the key data that Fed put more weight than CPI to assess inflation.
Recommendation
With this outlook, and to be on the safe side, we strongly recommend all Ophiuchus and Limitless EA users to schedule to stop trading for this series of economic announcements starting from 26 July till 30 July. You can use the stop trading period feature in the EA to do that. You can also decide to start the stop trading for a longer period to wait for the dust settles. (eg, stop trading from 27 July and only start trading after Tuesday) if you would like.
Disclaimer – Please note that Limitless Trading is not liable for our recommendation and is not responsible for any loss or profit caused by this recommendation. This is general advice without considering your personal circumstances. You should assess your personal circumstances and perform your own research to make decisions for your trading.
