Account
New to ADSS? Open an
account now to get started.
Already have an account?
Add funds to your ADSS account
Account
New to ADSS? Open an
account now to get started.
Add funds to your ADSS account
Asset Watch
Wednesday, 18 September 2024
Markets are gearing up for tonight’s big event, the Federal Reserve interest rate decision, so here is everything you need to know about this risk event.
Rate decision: The Fed will kickstart its rate cut cycle tonight at 10:00 PM UAE time, with either 25 basis points or 50 basis points reduction. The market is currently split between those expecting a 25 bps cut and those predicting a 50 bps cut. It’s worth noting that the market has already priced in a more than 40 bps cut for this meeting, and some Fed members have hinted that the central bank may align with market expectations.
The rate decision’s potential effect: Should the Fed cut by a 50 bps, it could lead to an even weaker US dollar and slightly stronger gold and stock prices. On the other hand, if the Fed cuts by a 25 bps, the market’s reaction may hinge on Fed Chair Powell’s tone in his press conference taking place tonight at 10:30 PM UAE time. Any hint of possible bigger rate cuts before the end of the year could weigh on the US dollar and support the gold and stock prices. However, if Powell signals that the rate cut could maintain its current pace, we may see a drop in price in gold and stock prices and a stronger US dollar.
The Fed Dot Plot: The Fed will release its economic projections for the US GDP, unemployment and inflation, alongside the FOMC dot plot, which reflects the Fed members’ opinions on where interest rates might be in the short and the longer term, which could allow some investors to sync their views with the FOMC members’ view.
Chart Source: ADSS Platform
On September 12, the gold price broke above the upper line of the bullish rectangle located at 2530 and now the precious metal price appears to be heading for a test of the high end of the current trading zone between 2470 and 2600.
A daily close above the high end of the zone at 2600 indicates a stronger upward trend, possibly enticing bulls to rally the price towards the 2700 mark. In this case, the resistance level of 2650 should be considered.
On the other hand, failure to close above the high-end level at 2600 reflects a weakening bullish momentum, potentially sending the price to revisit the low end of the zone.
ADSS
8th floor, CI Tower
Corniche Road
PO Box 93894
Abu Dhabi
United Arab Emirates
Trading Services
ts@adss.com
+971 2 657 2414
Investing in CFDs involves a high degree of risk that you will lose your money due to the use of leverage, particularly in fast moving markets, where a relatively small movement in the price can lead to a proportionately larger movement in the value of your investment. This can result in loses that exceed the funds in your account. You should consider whether you understand how CFDs work and you should seek independent advice if necessary.
ADS Securities LLC (“ADSS”) is authorised and regulated by the Securities and Commodities Authority (“SCA”) in the United Arab Emirates as a trading broker for Over the Counter (“OTC”) Derivatives contracts and foreign exchange spot markets. ADSS is a limited liability company incorporated under United Arab Emirates law. The company is registered with the Department of Economic Development of Abu Dhabi (No. 1190047) and has its principal place of business at 8th Floor, CI Tower, Corniche Road, P.O. Box 93894, Abu Dhabi, United Arab Emirates.
The information presented is not directed at residents of any particular country outside the United Arab Emirates and is not intended for distribution to, or use by, any person in any country where the distribution or use is contrary to local law or regulation.
ADSS is an execution only service provider and does not provide advice. ADSS may publish general market commentary from time to time. Where it does, the material published does not constitute advice, or a solicitation, or a recommendation to a transaction in any financial instrument. ADSS accepts no responsibility for any use of the content presented and any consequences of that use. No representation or warranty is given as to the completeness of this information. Anyone acting on the information provided does so at their own risk.
