Markets are on pause as the U.S. Federal Reserve is set to deliver its interest rate decision later today at 20:00 SAST which is widely expected to remain unchanged.
What market participants will be looking at is the Fed chair Powell statements at the FOMC press conference scheduled for 30 min after the rate announcement. Investors might look for signs that the path to recovery is moving faster towards normalization than previously indicated. The lagging labour market might put a damper on policy tightening while Treasury Yield could get attention.
Global markets are lower this Wednesday morning ahead of the FOMC interest rate decision with the Shanghai Composite index down 0.4%, and the Hang Seng lower by 0.2%. U.S Futures are also pointing lower with Gold gaining some favour on higher inflation expectations.
Here is what’s expected this week:
The Wall Street 30 Technical Analysis
The price action on the WS30 has pushed through the 32082 resistance which was the upper range level as discussed in last weeks Wall Street 30 note. The 32082 level has now become the support level of interest to watch for a possible throw back before price pushed higher.
With market volatility expected later today we might see a push straight out of the gate towards our new target price of 33765 on the WS30.
- The new levels of interest are the 32082 support, 33016 resistance and our long-term target price at the 33765 level.
- The 50-day SMA (blue line) is pointing higher which supports the higher move and could also come into play as support on the 4H chart.
- The Relative Strength Index (RSI) is above the 50 mark and at overbought levels which also supports higher prices now.
Chart Source: Wall Street 4H Timeframe - GT247 MT5 Trading Platform
Trading term of the day
A throwback, in technical analysis, is when the price retraces toward the breakout point after moving through a resistance level. A resistance level is where the price has stalled or had trouble moving through in the past. When the price moves through that level it is called a breakout. Not all breakouts are followed by a throwback, but some are. A throwback is a move back toward the prior resistance level. A false breakout is when the throwback continues below the breakout/resistance level. – Investopedia
Take note: The outlook and levels might change as this outlook is released during the current days (Wednesday the 17th of March 2021) U.S Market open and FED Interest rate decision.
Sources – MetaTrader5, Reuters, Investopedia
Barry Dumas | Market Analyst at GT247.com
Barry has 12 years experience in the financial markets. He enjoys educating clients on trading / investing and providing punchy technical analysis on securities. He currently holds a Wealth Management qualification and is studying towards becoming a Chartered Market Technician® (CMT) designation holder.
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