FXStreet (Guatemala) – Valeria Bednarik, chief analyst at FXStreet explained that as largely expected, the US Federal Reserve kept rates unchanged, but acknowledged rising headwinds, as they say that are closely monitoring global economic and financial developments.
Key Quotes:
“They also added that the jobs market improved further even as economy slowed late 2015, while the economy is expected to warrant only gradual rate rises. Overall, dovish, but pretty much what the market was waiting for, resulting in a limited dollar’s slide.
Earlier today, German GFK consumer confidence beat expectations for February, printing 9.4 against the 9.3 expected, and matching previous month reading. In the US, new home sales beat estimates with a 10.8% December registering a seasonally adjusted annual rate of 544,000 units, inventories popped 2.6% in December to a six-year high, while the median price fell 2.7% to leave a 4.3% y/y drop.
The EUR/USD pair traded as high as 1.0911 during the European morning, but faded half of its intraday gains as crude oil surged. Following FED’s dovish announcement, the commodity retreated, helping the EUR/USD pair extend up to 1.0912, but was steadily rejected from spikes beyond the 1.0900 figure. The short term picture is bullish, given that in the 1 hour chart, the price holds above its moving averages whilst the technical indicators present strong upward slopes in positive territory.
In the 4 hours chart, the upside is also favored, with the price above its moving averages and the technical indicators gaining upward strength well above their mid-lines. Selling interest however, has contained rallies between 1.0920 and 1.0960 ever since the year started, meaning that the pair needs to steadily advance beyond it to offer a more constructive outlook.”
(Market News Provided by FXstreet)