AUD/USD: 0.8735EUR/USD: 1.3650The Euro had a quick early blip down to the 100D DMA, on the back of the turmoil going on in the emerging markets, hitting a low of 1.3602 before rebounding to sit pretty much unchanged ahead of the FOMC outcome.
The Fed announcement of another $10 bio taper and a mildly improved outlook for the economy was all a bit of a fizzer as far as the market was concerned and had little immediate impact. So the Bernanke term is done – over to Janet Yellen.
The Euro essentially stuck within a 20 point range, sitting at 1.3645 at the time of writing and remains pretty much in the middle of the recent range.
1.3600 now becomes the initial major support and having bounced off there today, it could well hold in the coming session although the 4 hour charts do suggest that it could once again come under pressure later in the day. Below here would run towards 1.3550 (rising trend support), 1.3525 (61.8% of 1.3294/1.3892), and then below 1.3500 would head down towards 1.3455 (23.6% of 1.2042/1.3892 & 38.2% of 1.2755/1.3892) and eventually, 1.3435 (76.4% of 1.3294/1.3892).
On the topside, 1.3685 is minor resistance, with more sellers lined up in the 1.3700/20 area ahead of the recent 1.3739 high. Above that would head on to the base of the monthly cloud, descending quickly but currently at 1.3755, which should be strong, but a break of which would take us back to 1.3800, and above, towards the 27 Dec, 1.3892 high.
The dailies still remain mildly positive and I suspect that for the next 24 hours, while the markets digest the outcome of the Fed's decision and any possible ramifications for the EM, we are likely to continue with the choppy trade, so I would use the 1.36/1.37 range as a guide, with a mild downside bias.
There will be plenty of data out later today, and as far as Asia is concerned, it is the beginning of the Chinese New Year, so liquidity will begin to thin out a little.
Economic data highlights will include:
German Unemployment, CPI, EU Business Climate, PPI, Consumer Confidence, US GDP, Jobless Claims, Pending Home Sales
