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19 Mar 2015
AUD/USD retesting 0.78 in Tokyo
FXStreet (Bali) - AUD/USD is accelerating above 0.78 after bouncing off 0.7740/45 intraday support, with broad-based USD weakness still dominating.
Short-term, the dovish FOMC outcome has caught USD bulls upside down, with a spectacular USD long squeeze, especially in EUR/USD (up over 200 pips in minutes), dragging the world's reserve currency deeply into the red across the board. The question now is, with the FOMC more cautious on its interest rate hike projections, can the USD maintain its underlying uptrend pace, or does the setback have legs left?
Kathy Lien, Co-Founder at BK Asset Management, notes: "The main takeaway from today's monetary policy meeting is that U.S. rates are still headed higher this year and nothing today changes our outlook. The Fed may not move as quickly as some dollar bulls had hoped and the dollar is adjusting as a result. However we don't expect the slide to last and 6 months forward we expect the dollar to be trading 3 to 5% above current levels."
Short-term, the dovish FOMC outcome has caught USD bulls upside down, with a spectacular USD long squeeze, especially in EUR/USD (up over 200 pips in minutes), dragging the world's reserve currency deeply into the red across the board. The question now is, with the FOMC more cautious on its interest rate hike projections, can the USD maintain its underlying uptrend pace, or does the setback have legs left?
Kathy Lien, Co-Founder at BK Asset Management, notes: "The main takeaway from today's monetary policy meeting is that U.S. rates are still headed higher this year and nothing today changes our outlook. The Fed may not move as quickly as some dollar bulls had hoped and the dollar is adjusting as a result. However we don't expect the slide to last and 6 months forward we expect the dollar to be trading 3 to 5% above current levels."