{"id":438208,"date":"2026-09-16T20:00:18","date_gmt":"2026-09-16T13:00:18","guid":{"rendered":"https:\/\/www.swingfish.trade\/blog\/market-news\/morning-kickstart-fed-rate-decision-takes-center-stage-what-are-the-technicals-telling-traders-in-the-3-key-forex-pairs-438208\/"},"modified":"2026-09-16T20:00:18","modified_gmt":"2026-09-16T13:00:18","slug":"morning-kickstart-fed-rate-decision-takes-center-stage-what-are-the-technicals-telling-traders-in-the-3-key-forex-pairs","status":"publish","type":"post","link":"https:\/\/www.swingfish.trade\/blog\/market-news\/morning-kickstart-fed-rate-decision-takes-center-stage-what-are-the-technicals-telling-traders-in-the-3-key-forex-pairs-438208\/","title":{"rendered":"Morning Kickstart: Fed rate decision takes center stage. What are the technicals telling traders in the 3 key forex pairs?"},"content":{"rendered":"<div>\n<p dir=\"auto\" class=\"PDq2pG_selectionAnchorContainer\">The USD is mixed and little changed to start the North American session. That is not all that surprising, as traders prepare for the BIG EVENT today\u2014the Federal Reserve rate decision.<\/p>\n<p dir=\"auto\">The USD is trading higher versus:<\/p>\n<ul>\n<li>EUR: +0.04%\n<\/li>\n<li>GBP: +0.11%\n<\/li>\n<li>CAD: +0.11%\n<\/li>\n<\/ul>\n<p dir=\"auto\">The USD is trading lower versus:<\/p>\n<ul>\n<li>JPY: \u22120.04%\n<\/li>\n<li>CHF: \u22120.02%\n<\/li>\n<li>AUD: \u22120.06%\n<\/li>\n<li>NZD: \u22120.07%\n<\/li>\n<\/ul>\n<p dir=\"auto\">The changes are modest across the board. The USD has gained the most against the GBP and CAD, while it has fallen the most against the NZD. Nevertheless, there is no strong dollar trend heading into the North American session.<\/p>\n<p dir=\"auto\">In the Kickstart video, I take a technical look at the three major currency pairs\u2014EURUSD, USDJPY and GBPUSD. For each pair, I outline the bias, the risk-defining levels and the targets that would give either the buyers or sellers more control.<\/p>\n<p dir=\"auto\">The Fed decision is the BIG EVENT today<\/p>\n<p dir=\"auto\">A 25-basis-point rate increase is expected, which would lift the federal funds target range to 3.75%\u20134.00%.<\/p>\n<p dir=\"auto\">The Treasury market has already done some of the tightening for the Fed. The 2-year yield is up to 4.629%, while the 10-year yield has traded above and below the key 5.00% level this week. That is a pretty significant move in market rates.<\/p>\n<p dir=\"auto\">With inflation remaining sticky and the labor market continuing to show resilience, members of the Federal Open Market Committee have ample reason to raise rates. Theoretically, higher rates should help slow inflation. The risk is that they can also slow growth and hiring.<\/p>\n<p dir=\"auto\">The expected hike would also go against President Donald Trump\u2019s preference for lower rates to help stimulate the economy.<\/p>\n<p dir=\"auto\">However, since the quarter-point increase is largely priced in, the rate decision itself may not be where the bigger market reaction comes from. Traders will instead focus on the updated economic projections and what Fed Chair Kevin Warsh has to say at his press conference.<\/p>\n<p dir=\"auto\">The Fed will release updated projections for:<\/p>\n<ul>\n<li>\nGDP growth\n<\/li>\n<li>\nInflation\n<\/li>\n<li>\nUnemployment\n<\/li>\n<li>\nThe federal funds rate\n<\/li>\n<\/ul>\n<p dir=\"auto\">The June projections put the federal funds rate at 3.80% at the end of 2026. The new projection today, will determine whether officials expect that to be a &#8216;one and done&#8221;\u00a0insurance hike, or whether another increase may be needed before year-end. There are two more meetings before the end of the year.\u00a0\u00a0<\/p>\n<p dir=\"auto\">Do not expect Kevin to provide a detailed road map for future policy. He has long been against giving markets extensive forward guidance. That may leave traders to draw their own conclusions from his comments, the policy statement and the updated projections.<\/p>\n<p dir=\"auto\">For traders, it will not only be about what the Fed does. It will be about how the markets react.<\/p>\n<p dir=\"auto\">As always, the price action and the technical tools applied to that price action will help tell the story.<\/p>\n<p dir=\"auto\">U.S. Treasury yields are lower with the 10 year back below 5%<\/p>\n<p dir=\"auto\">Treasury yields are modestly lower ahead of the decision, but they remain at elevated levels:<\/p>\n<ul>\n<li>2-year: 4.629%, down 3.4 basis points\n<\/li>\n<li>5-year: 4.795%, down 3.1 basis points\n<\/li>\n<li>10-year: 4.971%, down 2.5 basis points\n<\/li>\n<li>30-year: 5.346%, down 1.7 basis points\n<\/li>\n<\/ul>\n<p dir=\"auto\">The 2-year yield is especially sensitive to expectations for Fed policy. If Kevin emphasizes sticky inflation and leaves the door open for additional tightening, the 2-year yield could move higher.<\/p>\n<p dir=\"auto\">The 10-year yield is also important after trading above and below 5.00% this week. Staying above 5.00% would keep the pressure on borrowers, businesses and equity valuations. Moving back below that level would provide some relief, but it would take more downside momentum to reverse the recent rise in longer-term yields.<\/p>\n<p dir=\"auto\">Middle East tensions remain high, but oil is lower<\/p>\n<p dir=\"auto\" class=\"PDq2pG_selectionAnchorContainer\">Middle East risks remain elevated following attacks on Saudi energy infrastructure and renewed threats from the Iran-backed Houthis.<\/p>\n<p dir=\"auto\">Saudi Arabia said it intercepted a Houthi drone approaching restricted airspace around Mecca, calling the incident a \u201cred line.\u201d The Houthis denied targeting the holy city but have threatened further attacks. The escalation has increased concerns about the Yanbu oil terminal, the East-West pipeline and shipping through the Red Sea and Bab el-Mandeb. <\/p>\n<p dir=\"auto\">Some supply concerns have eased. Saudi Arabia is reportedly offering additional crude shipments through Oman\u2019s Sohar port, while regional oil flows have been more resilient than feared. Unexpected increases in U.S. crude and fuel inventories are also helping pressure oil prices. <a class=\"decorated-link\" rel=\"noopener\" target=\"_new\" href=\"https:\/\/www.reuters.com\/business\/energy\/oil-falls-us-crude-inventories-rise-despite-saudi-supply-concerns-2026-09-16\/?utm_source=chatgpt.com\">Reuters<\/a><\/p>\n<p dir=\"auto\">WTI crude is trading at $103.37, down $2.46 or 2.32%. Despite the decline, oil remains above $100, and the geopolitical risk has not disappeared.<\/p>\n<p dir=\"auto\">The trading lesson is that bullish headlines do not guarantee higher prices. Some risk may already be priced in, and oil can decline when supplies are rerouted or immediate disruption fears ease. The price action is the final judge.<\/p>\n<p dir=\"auto\" class=\"PDq2pG_selectionAnchorContainer\">U.S. stock futures point higher<\/p>\n<p dir=\"auto\">U.S. stock futures are trading higher ahead of the opening bell, with all three major indices showing solid gains:<\/p>\n<ul>\n<li>Dow futures: +211 points\n<\/li>\n<li>S&amp;P 500 futures: +36 points\n<\/li>\n<li>Nasdaq 100 futures: +205 points\n<\/li>\n<\/ul>\n<p dir=\"auto\">The Nasdaq is leading the advance as buyers return to technology shares, while the broader gains in the Dow and S&amp;P point to a generally positive risk tone.<\/p>\n<p dir=\"auto\">Commodities and Bitcoin<\/p>\n<p dir=\"auto\">Gold and silver are both higher despite the modest decline in Treasury yields and the mixed USD.<\/p>\n<ul>\n<li>WTI crude: $103.37, down $2.46 or 2.32%\n<\/li>\n<li>Gold: $4,350.94, up $57.77 or 1.35%\n<\/li>\n<li>Silver: $64.82, up $1.16 or 1.82%\n<\/li>\n<li>Bitcoin: $75,955, up $378 or 0.50%\n<\/li>\n<\/ul>\n<p dir=\"auto\">Gold is benefiting from continued geopolitical uncertainty and some dip buying as Treasury yields ease ahead of the Fed. However, the reaction after the Fed will be important.<\/p>\n<p dir=\"auto\">A more hawkish Fed, higher yields and a stronger USD would normally create headwinds for gold. A less hawkish Fed, lower yields and a weaker USD would be more supportive.<\/p>\n<p dir=\"auto\">Bitcoin is modestly higher but remains below $76,000. Like the other markets, its next directional move may depend on the reaction in the USD, yields and overall risk sentiment following the Fed announcement.<\/p>\n<p dir=\"auto\">Why today\u2019s combination matters<\/p>\n<p dir=\"auto\">The Fed is dealing with a difficult combination:<\/p>\n<ul>\n<li>\nInflation remains sticky.\n<\/li>\n<li>\nThe labor market remains resilient.\n<\/li>\n<li>\nOil is still above $100.\n<\/li>\n<li>\nThe 10-year yield is near 5%.\n<\/li>\n<li>\nGeopolitical risks remain elevated.\n<\/li>\n<\/ul>\n<p dir=\"auto\">Higher oil prices can feed into headline inflation and inflation expectations. Higher Treasury yields increase borrowing costs even before the Fed makes its decision. Together, those dynamics give policymakers a reason to remain cautious about declaring victory over inflation.<\/p>\n<p dir=\"auto\">The quarter-point hike may be largely priced in, but the market\u2019s reaction is not.<\/p>\n<p dir=\"auto\">That is why the updated projections, Kevin\u2019s comments and\u2014most importantly\u2014the subsequent price action will be the focus for traders today.<\/p>\n<p dir=\"auto\" class=\"PDq2pG_selectionAnchorContainer\">Economic data ahead of the Fed<\/p>\n<p dir=\"auto\">Before the Fed takes center stage this afternoon, traders will have several economic releases to work through. The main focus at 8:30 AM ET will be U.S. retail sales and import prices.<\/p>\n<p dir=\"auto\">Retail sales will provide a fresh look at the strength of the consumer, while import prices may offer additional clues on inflation pressures. Stronger-than-expected figures\u2014especially for the retail sales control group\u2014could reinforce expectations that the Fed will remain restrictive.<\/p>\n<p dir=\"auto\">8:30 AM ET<\/p>\n<ul>\n<li>Import prices MoM: +0.4% expected versus \u22120.4% previously\n<\/li>\n<li>Import prices YoY: No forecast shown; +6.0% previously\n<\/li>\n<li>Export prices MoM: +0.5% expected versus \u22121.3% previously\n<\/li>\n<li>Retail sales MoM: +0.8% expected versus \u22120.6% previously\n<\/li>\n<li>Retail sales excluding autos: +0.5% expected versus \u22120.3% previously\n<\/li>\n<li>Retail sales excluding gas and autos: No forecast shown; \u22120.2% previously\n<\/li>\n<li>Retail control group: +0.4% expected versus \u22120.4% previously\n<\/li>\n<li>Retail sales YoY: No forecast shown; +5.01% previously\n<\/li>\n<li>Canada building permits MoM: \u22126.4% expected versus +18.5% previously\n<\/li>\n<\/ul>\n<p dir=\"auto\">10:00 AM ET<\/p>\n<ul>\n<li>U.S. business inventories: +0.3% expected versus 0.0% previously\n<\/li>\n<li>Retail inventories excluding autos: No forecast shown; +0.7% previously\n<\/li>\n<li>NAHB Housing Market Index: 34 expected versus 35 previously\n<\/li>\n<\/ul>\n<p dir=\"auto\">The retail control group will be especially important. It excludes several volatile categories and feeds more directly into the consumer-spending calculation used in GDP. A stronger figure would point to a resilient consumer, while a weaker number would raise additional questions about economic growth.<\/p>\n<p dir=\"auto\">Still, any reaction to the morning data may be limited or short-lived. The Fed decision, updated economic projections and Kevin Warsh\u2019s press conference remain the BIG EVENT today.<\/p>\n<p>                            This article was written by Greg Michalowski at investinglive.com.<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"<p>The USD is mixed and little changed to start the North American session. That is not all that surprising, as traders prepare for the BIG EVENT today\u2014the Federal Reserve rate decision. The&hellip;<\/p>\n","protected":false},"author":216,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[86],"tags":[],"class_list":["post-438208","post","type-post","status-publish","format-standard","hentry","category-market-news"],"_links":{"self":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/posts\/438208","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/users\/216"}],"replies":[{"embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/comments?post=438208"}],"version-history":[{"count":0,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/posts\/438208\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/media?parent=438208"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/categories?post=438208"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/tags?post=438208"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}