Forex

Strong Dollar" rhetoric but after the initial brief USD rally into expected S/R the Greenback reversed hard and fell to new lows on the day across the board.

Stops were seen in all pairs but active selling of USD was noted by several shops as
the USD made highs around the FOMC announcement. Traders were not surprised
at the strength of the reversal or the speed and many expressed concern that
the USD will get ahead of itself on a decline before the ECB has a chance to
raise rates next week. GBP rallied for a high print at 1.9771 after the
announcement; traders note that stops were elected at 1.9740/50 area after
the first push to there was repelled during the day. In other words, shorts
sold ahead of the news and placed their stops close-in expecting a drop
which never happened. EURO plowed through near-term resistance and is no
officially rallying; stops placed around the 1.5630 area were triggered as
layered supply above the 1.5600 area was absorbed after the news. EURO now
has no top ahead of the 1.5800/20 area some traders say and a sustained
rally may be in the works for tomorrow and Friday. Should the EURO clear the
1.5800 area or beyond by the end of the week that would make this month an
engulfing month on the charts-a very bullish scenario. USD/JPY failed to
inspire trade either way for most of the day preferring to hover at the
108.00 handle until the Fed news; a brief rally to 108.43 high print was
sold aggressively and the rate reversed into low prints at 107.65 within
minutes. The rate is unable to break out of the 108.40-107.00 range that has
plagued this pair for over a week. When it finally goes one way or the other
it could be a spectacular move. USD/CHF also reversed hard making lows on
the day at 1.0340; traders expect more. Almost lost in the day's action was
earlier US data, Durables were flat and housing was lower; traders expect
that more unfriendly news will be seen for tomorrow as well. In my view,
nothing to do but buy dips in EURO and add to open shorts in other pairs.