I’ve been long the EURUSD pair for a week now anticipating a cut in rates today and boy did the Fed deliver! Although I hoped for no cut, the reality was that the Fed had to act to contain the subprime mess and essentially bail out the Hedge Fund guys. Get ready for more rampant inflation and a greater erosion of the Dollar. :)
The best part about today was watching the currency markets. I always love watching them on major economic announcement days because the activity dies down usually an hour before the announcement and then goes wild a few seconds before I get the news. I can tell usually if the news was good or bad by the direction of the EURUSD pair right after.
The bottom line: today was a good day for the Euro and a lousy one for the Dollar. What about my trade? Me? I made over 125 pips today, or roughly 3.57R! Nice!
