Morning Guys! Stocks and commodities are trading higher across the board after the Federal Reserve said it will spend $600 billion in a new bond-buying program to support the economy. So it’s not a surprise that US dollar is showing a very weak picture against the other major currencies, especially against the Euro which is the strongest currency in this first part of the European session, probably because of speculation that the European central Bank will keep withdrawing its stimulus measures.
Guest post by Gregor Horvat
From a technical point of view, it was not easy to recognize the right direction yesterday at 13:15 EDT when the FOMC kept its benchmark interest rate target for overnight interbank loans at zero to 0.25 percent.
On the 1h Eur/Usd line chart, which is much clearer to read, is showing a clear direction of a powerful bullish trend as expected (click here for our past video from Tuesday)that reached 1.4250 region this morning. However, trend is unfinished since we need five waves up from a fourth wave triangle low, within a red wave 5), before we may look for any reversal, as Elliott Wave Theory suggests. Trend is our friend they say! Bullish bias as long as the market trades above 1.4100 and 1.4060.
Eur/Usd 1h (line) chart:
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