Fed Paused at 5.25% + Hawkish Comments = Dollar Back In The Game.

It was widely expected that the Federeal Reserve will pause their benchmark interest rates at 5.25% in August. But what matters most was are they going to continue after this month? Inflationary pressures are still in talks when July reports showed inflation is still around the corner, but economy growth is visibly slowing down. So, I would say it's a wise move for the Fed to pause for a month and then keep options open for the remaining of the year.

For the Euro's report, Germany's industrial production posted an unexpected decline during June, as foreign demand for its goods waned. Production dipped by 0.4% from May, according to Economy Ministry figures. Germany's economy is the largest in Europe and it has relied heavily on export sales to drive growth as consumers spending has been subdued. However, over recent months inflation fears have increased prompting a rise in global interest rates that many analysts are worried may hamper growth. German current account of the balance of payments showed a surplus of EUR10.1 billion in June, the provisional results of the Deutsche Bundesbank said Tuesday. The current account surplus consists of EUR1.5 billion deficit in the supplementary trade items account and EUR1.6 billion deficit in services account. Further, the current account surplus includes net factor income of EUR1.4 billion as well as EUR1.5 billion deficit in current transfers account.

What was most interesting from the immediate reaction from the market was EUR/USD on extremely bullish which immediately pushed up to as high as 1.2893, never made it near 1.29, not to mention 1.30. As I had a trade Long EUR/USD @ 1.2820, I've moved up my stop-loss to 1.2840, securing myself 20 pips of profit. The trade was closed in a matter of 15 minutes time due to the stop-loss I placed to protect myself. Glad that I did it, because hawkish comments would definately regenerate dollar buying interest in the market, or at least I interpret it as hawkish. I was sidelined for 35 minutes diciding on what is the next step and analysing the statement from Ben Bernanke regarding further hike, and thinking and thinking, analysing what's the next best trade. I managed to convince myself that USD would have an upper hand in the short range and I go Long USD/CHF @ 1.2245. Hopefully I'll be right in this.

My trading technique has been very suitable for me as I always get into the right price before the next big move. It's been proven repeated since I got my margin call. I don't really use any techical analysis tools to make an entry (MA, MACD, Boilinger Bands... etc) but I do respect them and use them as a guide to my analysis. I'm only using candlestick chart, price movements, and fundamental analysis, which is also my best asset in forex trading. It works for me but I guess it really takes lots of thinking. I'm using a full leverage system with this technic. With stop-loss in place, lots to gain and a little to lose. But remember to give some time for your trades if it don't turn profit to you immediately, sometimes it needs time to be a profitable trade.

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Trades Closed
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Long EUR/USD @ 1.2820, SL @ 1.2840 ( +20 pips )

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Existing Trades
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Long USD/CHF @ 1.2245, Current SL @ 1.2260 ( +15 pips is confirmed )

Happy Trading!