Global macro overview for 25/02/2016:
The US Federal Reserve will release the FOMC statement on Wednesday, April 27 at 06:00pm GMT. The market participants are not expecting a rate hike at this point, mainly because there is no press conference after the news release. In that case, the language of the statement will be closely scrutinized for clues about the June FOMC meeting ( this one is with the press conference). The Fed downgraded its rate hike expectations for 2016, justified by global headwinds that limited the US growth. So far employment remains the strongest pillar of the US economic recovery, but the job gains and the lowest unemployment claims in 42 years won't be enough to remove the opinion of the Fed 's members to vote for a rate hike until other economic indicators show improvement. In conclusion, in case of unexpected rate hike, the market environment might get very volatile, so it is worth to keep an eye on this event for sure.
Let's now take a look at the US Dollar index technical picture in the 4H time frame ahead of the FOMC meeting. The recent supply zone was fully tested and the market now is falling after a 128-pip rally. Nevertheless, as long as the level of 95.22 is clearly violated, bears are in control of this market. The next support is seen at the level of 94.77, and any break out below will support the bearish view.
