Dollar Down Despite Positive FOMC Statement
March 19, 2015 9:30 amVideo
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March 19, 2015 – Forex News
Hot asset for today: USD
EUR/USD
Yesterday, the EUR/USD jumped over 400 pips within 3 hours and climbed above 1.1000. The pair reacted to the FOMC economic projections, as the economic outlook was downgraded. This move shifted speculation that the interest rate will be hiked in September rather than in June. The negative reaction was not expected as Janet Yellen actually mentioned that there is a chance rates could be lifted in June and the term ‘patient’ was removed from the statement. In addition, the outlook was expected to worsen due to the stronger Dollar and inflation pressures from lower oil prices.
Today at 10.15AM (GMT), traders should pay attention to the EU Targeted LTRO which will tell us how much the ECB will create and lend to the banks in the Eurozone. At 2.00PM (GMT), the U.S. Philadelphia Fed Manufacturing Index will be released and is expected to slightly increase.The trend is sideways. Support is found at 1.0670 and resistance at 1.1000.
GBP/USD
Yesterday, the GBP/USD peaked above 1.5160 but reversed and returned below 1.4900. The dollar weakened as the FOMC economic projections were released and disappointed the market. As written in the previous paragraph, the actual FOMC statement was not that dovish and the word “patient” was removed. Therefore, if strong U.S. data is released we should expect that the pair should erase its gains and continue down. This bearish outlook is supported by uncertainty around the upcoming British elections.
Today, traders should keep an eye on the U.S. Jobless Claims figure, which is coming out at 12.30PM (GMT), and at 2.00PM (GMT) the U.S. Philadelphia Manufacturing Index will be announced. The trend is sideways. Support is found at 1.4850 and resistance at 1.5010.
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