EUR/USD is consolidating gains around the 1.1220 vicinity, having jumped more than 1.5 cents from 1.1050/60 ahead of the FOMC decision, to print a 1-month high at 1.1240, not seen since February 15th, as USD bulls bail out of their positions after a surprisingly dovish FOMC on Wednesday.
Fed turns more dovish, USD bulls run to the exits
As Valeria Bednarik, Chief Analyst at FXStreet, notes: “The market was all about the US Federal Reserve, and what they offered was not what the market was expecting. Policy makers see now just two rate hikes in 2015 from previous four, while they also cut the GDP forecast for 2016 down to 2.2% from 2.4%. Janet Yellen´s press conference indicated that major concerns are still abroad, but also that some participants don’t longer saw the risk balanced, as some saw them tilted towards the downside.”
EUR/USD technicals
There are “strong bullish implications coming from technical readings”, Valeria notes, arguing that “in the 4 hours chart, the strong advance has sent price well above its moving average, and left indicators heading sharply higher within bullish territory.” A sticky resistance level stands around 1.1245, Valeria says, “with a break beyond exposing the pair to an advance towards 1.1300 this Thursday”, the Analyst added.
(Market News Provided by FXstreet)