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19 Mar 2014
Session Recap: How long are six months; EUR/USD tests 1.3810
FXStreet (San Francisco) - As Mr. Adam Button from ForexLive said in a recent piece of news, "the market is dead-scared of rate hikes," and so... Janeth Yellen commented about the possibility to hike rates on a "considerable time," while she added "maybe 6 months, or something like that." Then market believed in a rate hike in April-May... and then the USD said arrivederci!
The Greenback rallied in the late Wednesday session following the Fed decision to maintain unchanged its interest rate but to cut its bond buying monthly pace by another $10 Bn. Taper continues or ongoing taper as you wish to call it.
Rates were the point of salt of Yellen's intervention as the chair suggested interest rate would rise in about six months but not before quantitative easing program ends. In this regarding, the Fed will keep reducing stimulus.
So, taper was expected, "why is the dollar gaining ground?" as FXStreet chief analyst Valeria Bednarik asked in a recent report. She answers: "Hard to answer that accurately, considering is easy now to find excuses after is all set and done. The fact is that the market is finding Yellen’s words encouraging, and therefore, trusting in US future."
Anyway, EUR/USD collapsed to test 1.3810, lowest since March 6; the GBP/USD declined to try the 1.6500 area while the USD/JPY rallied to 102.70 after recovering the 102.00 level.
The key is 1.3800, below this area, "the pair may extend its slide towards 1.3740/60 area over the upcoming 24 hours, yet if the level holds, the pair may try to regain at least partially the ground lost," adds Bednarik. In the short term, EUR/USD is oversold in 1-hour chart but pretty bearish in 4-hour chart.
How long are six months? Today the market assumed it means as soon as April/May; yesterday the investors watched it as 7 years of recovery from the great great depresion.
American session's major news
Moody's expects UK 2014 budget to be consistent with UK's AA1 bond rating
Fed continues to taper QE program, updates forward guidance
Hilzy's quick takes
Wall Street closes down after Fed decision
The Greenback rallied in the late Wednesday session following the Fed decision to maintain unchanged its interest rate but to cut its bond buying monthly pace by another $10 Bn. Taper continues or ongoing taper as you wish to call it.
Rates were the point of salt of Yellen's intervention as the chair suggested interest rate would rise in about six months but not before quantitative easing program ends. In this regarding, the Fed will keep reducing stimulus.
So, taper was expected, "why is the dollar gaining ground?" as FXStreet chief analyst Valeria Bednarik asked in a recent report. She answers: "Hard to answer that accurately, considering is easy now to find excuses after is all set and done. The fact is that the market is finding Yellen’s words encouraging, and therefore, trusting in US future."
Anyway, EUR/USD collapsed to test 1.3810, lowest since March 6; the GBP/USD declined to try the 1.6500 area while the USD/JPY rallied to 102.70 after recovering the 102.00 level.
The key is 1.3800, below this area, "the pair may extend its slide towards 1.3740/60 area over the upcoming 24 hours, yet if the level holds, the pair may try to regain at least partially the ground lost," adds Bednarik. In the short term, EUR/USD is oversold in 1-hour chart but pretty bearish in 4-hour chart.
How long are six months? Today the market assumed it means as soon as April/May; yesterday the investors watched it as 7 years of recovery from the great great depresion.
American session's major news
Moody's expects UK 2014 budget to be consistent with UK's AA1 bond rating
Fed continues to taper QE program, updates forward guidance
Hilzy's quick takes
Wall Street closes down after Fed decision