A look around the major currencies after the rate decision

Technical Analysis

Author: Greg Michalowski | sp

What are the technicals saying after the FOMC decision

Fed Powel laid the pipe for the start of the taper which would end around midyear next year which was not fully expected. The USD moved higher after his comments, but has seen some limited price action for some of the pairs against targets.

EURUSD: The EURUSD extended to a new high and above the target 1.1750 as well as the 100 hour moving average 1.17342. However after Powell's comments on the taper, the price move back below the 100 hour moving average at 1.17342 and the buyers turned sellers forcing the pair lower.

The pair moved below the 1.16996 to 1.17054 area which was a swing area outlined in a earlier post today. The move to the downside extended to 1.16836, but has seen the price action trade above and below the key swing area in the short term.

The price is currently trading at 1.1697. If sellers can keep a lid on at the 1.17054, we should see more dollar buying in a move toward the lows reached in August at 1.16637 (which are also the lows for the year).

USDJPY: The USDJPY moved higher with the dollar and in the process extended above its 100 hour moving average at 109.627, and it's 200 hour moving average at 109.676. The price moved up to the 100 day moving average at 109.849 and extended above that level to a high price of 109.894. However, momentum could not be sustained and the price moved back below that moving average level.  Despite the failure, the price remains above its 200 hour moving average at 109.676 and 100 hour moving average at 109.627. The price currently trades at 109.80. Going forward as long as the hourly moving averages can hold support, the buyers have the edge. Will below however and the tilt goes in the direction of the sellers.

GBPUSD: The high price, during the ups and downs on the forms the decision stalled at 1.3689. That was about 10 pips short of the falling 100 hour moving average 1.3699.  Stay below the 100 hour moving average kept the bears in play. The subsequent fall (dollar buying). Due to the price extend to a new session low at 1.36088. That still remained just above the swing low going back to August 19 at 1.36016. A move below the August low at 1.36016, and the July low at 1.3571 is needed to increase the bearish bias. The topside a move back above 1.36403 (and staying above that level) could see the shorts covering on the disappointment of not getting below the August low.

USDCHF: The USDCHF moved above its 200 hour moving average at 0.9236 level on the USD buying and raised up to test its 100 hour moving average at 0.92702.  Sellers came in near that level and have since pushed price back down. The pair currently trades at 0.9260 between the 200 hour moving average below and the 100 hour moving average above.  
Invest in yourself. See our forex education hub.
By continuing to browse our site you agree to our use of cookies, revised Privacy Notice and Terms of Service. More information about cookiesClose