The U.S. Dollar turned an early weak session into a gain by the close of the day. The Dollar was trading lower when the Fed announced it would keep pressure on interest rates.
The U.S. Dollar turned an early weak session into a gain by the close of the day. The Dollar was trading lower when the Fed announced it would keep pressure on interest rates. This news triggered a spike up in foreign currency markets, but by the end of the day, the Dollar recovered, reversing the day in most Forex pairs.
The strongest market was the GDP USD which was up most of the day following the release of the minutes from the last Bank of England open market committee meeting. The minutes were friendly because they did not discuss lowering rates for bank reserve accounts.
A secondary higher bottom was formed in the USD JPY which is an indication of higher prices to follow. Last week’s closing price reversal bottom in the USD JPY is still intact which indicates the potential for a rally back to .9395. A trade through .9252 will turn the main trend to up.
Weaker energy prices and the sell-off in equities drove the Canadian Dollar to fresh lows near the end of the day. The USD CAD chart formation indicates a move to 1.0819 is likely over the near term.
The EUR USD posted a daily closing price reversal top which indicates that profit-taking could pressure this market over the near-term. A follow-through to the downside is needed to confirm the reversal top. The trend is up but will turn to down if 1.4611 is penetrated.
The late sell-off in the U.S. equity markets put pressure on the AUD USD and NZD USD late in the trading session. The selling pressure helped form a closing price reversal top in the Australian Dollar which could be an indication of the start of a major break. The New Zealand Dollar closed well off of its high but managed to hold on to its gains.