Fed Decision: A Key Day for the Markets💸

This Wednesday, September 16, the United States Federal Reserve will announce its decision on interest rates. The statement will be released at 12:00 p.m. in Costa Rica, followed by the Fed Chair's press conference at 12:30 p.m. The market mostly expects a 25 basis point hike, as inflation remains above the 2% target and the U.S. economy maintains certain strength. For this reason, the initial move may depend less on the hike itself (which would already be partially priced in) and more on the message regarding upcoming decisions. Possible impact on Gold 🔥🤯 Gold is trading higher ahead of the announcement, near $4,350, as investors await new signals on the direction of monetary policy. These are the main scenarios: * Rate hike with a hawkish message: If the Fed warns that more hikes will be necessary to control inflation, the dollar and bond yields could strengthen. This scenario could generate downward pressure on gold. * Rate hike with a dovish message: If the Fed raises rates but leaves the door open for a potential pause soon, gold could recover after the initial volatility. * Rates unchanged: This would be a surprise compared to current expectations. The dollar could weaken and gold could react to the upside, though the move will depend on the explanation offered by the Fed. What should we watch? The reaction of the first candle will not necessarily mark the definitive direction. The market will have to process three elements: 1. The decision on rates. 2. The new economic and inflation projections. 3. The tone of the press conference. During this type of news, sharp moves, liquidity sweeps, and rapid changes in direction can occur. The most prudent approach is to avoid entering impulsively.