Fed Day

The big news today is of course, "Big" Ben Bernanke and the Federal Reserve Board's decision to raise rates for the 16th consecutive time, pushing the funds rate to its highest point in 5 years. (News coverage) Future rate hikes will depend on economic data indicating an increased threat of inflation. I imagine that will place even more importance on forthcoming fundamental data between now and June.

On the Forex market, particularly our currency pair of interest GBP/USD, the rate increase brought out the action. The market was slow until the news came out, at which point the Cable slipped, rebounded, and has been in a steady decline since.



I see an easy trade coming up, as the European market hasn't had a chance to react to the rate hike en masse. After they push it lower in the wee hours of the morning, price will probably continue its previous upward movement. I'm putting my trade in now: I'm stepping out of my comfort zone a little and going for 40 pips. S/L at 1.8584, T/P 1.8504.

I almost neglected to mention that I did some impulse trading at the time of the Fed announcement. This time I got off lucky, posting a 15.6 pip gain. I should probably make a rule not to do that in the future.

1 Winning Trade,
+15.6 pips