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CFDs are complex instruments. 72% of retail client accounts lose money when trading CFDs, with this investment provider. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money.
CFDs are complex instruments. 72% of retail client accounts lose money when trading CFDs, with this investment provider. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money.

Trading volatility: EUR/USD on eurozone consumer confidence, FOMC minutes

There are two events on Wednesday 24 November to watch out for that my stir some volatility.

Video poster image

We’re looking at a long position around EUR/USD for the eurozone consumer confidence and the minutes of the last Federal Reserve meeting at which they left rates on hold.

The assumption is that the risk is to the downside for the dollar which could result in a climb to resistance for the European single currency.

(Video summary)

FOMC minutes

Next week, there is an important event coming up that could affect how trading works. In the past, people saw this event as risky, but now they are talking about how it could affect trading. This event is the release of the FOMC minutes, which will describe what happened at the last Federal Reserve meeting where they decided to keep interest rates the same.

Some people think that there won't be any rate cuts until the Fed starts cutting rates. Some recent clues have shown that the Fed might actually lower interest rates by next May, but this idea is being challenged. Because of this, there has been a small change in the US dollar's strength.

The FOMC minutes will give a chance to see what's really going on, and traders might find interesting opportunities to trade the euro dollar.

Eurozone consumer confidence data

On top of the FOMC minutes, there will also be flash eurozone consumer confidence data released next Wednesday. If the Fed keeps its cautious stance, the euro/dollar might go even higher.

Traders who already have the euro/dollar can think about setting a stop loss order around the 107.30 level and have a price target of 109.45. This suggestion is based on a rising support level, which means that the market is likely to keep going up. There have been higher lows and higher highs, suggesting that the market will correct itself instead of making a big change in direction.

If there is more evidence that the eurozone is more likely to raise interest rates compared to the US, it is expected that the euro will keep getting stronger against the US dollar. Right now, the euro/dollar is at 108.37, and traders are advised to set their stop-loss at 107.30 to protect against potential losses.

In the long run, it is possible that the euro will go even higher against the US dollar, with a price target of 109.45.


This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

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