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 Forex Analysis
25

Forex Playbook: April 25-01


Overview

Risk aversion remains the overarching theme in the Forex marketplace, though temporary relief for riskier currencies is expected in the coming week of trading. Among others, the euro should extend its Friday gains into (early) next week, as profit taking overwhelms the longer term bearish outlook for the shared currency and the trading bloc itself.

Still, price action may be relatively quiet through midweek, as investors await the FOMC rate statement scheduled for Wednesday release. While interest rates are expected to remain unchanged at the upcoming meeting, investors may be surprised by a more hawkish tone out of the Federal Reserve. The Fed is certain to express ongoing concerns at persistent unemployment in the U.S.; however, the focus on strengthening economic indicators will likely obscure any mention of unemployment. Indeed, expectations of a June rate hike are likely to receive some validation from the FOMC rate statement.

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