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20 Jun 2013
US Dollar Index climbs after FOMC Release
FXstreet.com (Barcelona) - The US Dollar Index finished the day with strong gains, getting a boost after the conclusion of the FOMC Meeting and closing up 61 pips 81.47.
FOMC release adds to confusion of Fed ‘tapering’ timeline
Analysts at NAB Global shared some thoughts on the FOMC release, detailing a few of the key statements which may provide clues on the Fed’s timeline for a change in current policy. “Despite an FOMC statement that made no direct reference to scaling back on the current pace of Fed balance sheet expansion, the revisions to the FOMC’s central tendency forecast for the unemployment rate put markets on notice for some guidance from the Fed Chairman as to when the process of ‘tapering’ could begin.”
In conclusion, NAB went on to comment, “Tapering is not a word Bernanke chose to use, but in the press conference he made abundantly clear that based on the latest FOMC forecast, the Fed expected to start scaling back on its monthly bond purchases before the end of the year, and to cease net new bond buying completely by the middle of 2014.”
DXY technical set up improves, but the bulls still have to work to do
From a technical perspective, the sharp move higher today was impressive but the DXY bulls still have some work to do. The first development to point out is the close above the 9dma (81.22), which will now act as support (this is the first close above since May 29th). However, the RSI (14) is still below 40 and is maintaining the bearish zone between 20 and 60. Initial resistance now sits at 81.66 (high of day), followed by 82.00 (previous support, now resistance). Initial support sits at 81.22 (noted above), followed by 80.70 (support on daily chart).
FOMC release adds to confusion of Fed ‘tapering’ timeline
Analysts at NAB Global shared some thoughts on the FOMC release, detailing a few of the key statements which may provide clues on the Fed’s timeline for a change in current policy. “Despite an FOMC statement that made no direct reference to scaling back on the current pace of Fed balance sheet expansion, the revisions to the FOMC’s central tendency forecast for the unemployment rate put markets on notice for some guidance from the Fed Chairman as to when the process of ‘tapering’ could begin.”
In conclusion, NAB went on to comment, “Tapering is not a word Bernanke chose to use, but in the press conference he made abundantly clear that based on the latest FOMC forecast, the Fed expected to start scaling back on its monthly bond purchases before the end of the year, and to cease net new bond buying completely by the middle of 2014.”
DXY technical set up improves, but the bulls still have to work to do
From a technical perspective, the sharp move higher today was impressive but the DXY bulls still have some work to do. The first development to point out is the close above the 9dma (81.22), which will now act as support (this is the first close above since May 29th). However, the RSI (14) is still below 40 and is maintaining the bearish zone between 20 and 60. Initial resistance now sits at 81.66 (high of day), followed by 82.00 (previous support, now resistance). Initial support sits at 81.22 (noted above), followed by 80.70 (support on daily chart).