EUR/USD Rallies as FED's Rate Stance Shakes US Dollar

٢ نوفمبر ٢٠٢٣EUR/USD Rallies as FED's Rate Stance Shakes US Dollar

EUR/USD underwent a significant reversal, bouncing back from recent lows on Wednesday, closing with a modest gain around 1.0600. The pair's recovery continued, extending its upward momentum and surging to the 1.0650 level in early European trading on Thursday.

The US Dollar faced substantial selling pressure late on Wednesday, primarily due to the Federal Reserve's (Fed) inability to convince the market that it might pursue another interest rate hike in December.

As anticipated, the Fed opted to keep the policy rate steady within the 5.25%-5.5% range. The policy statement emphasized that policymakers would consider various economic factors when evaluating the potential need for additional policy tightening. During the post-meeting press conference, Chairman Jerome Powell refrained from confirming a static policy rate for the remainder of the year but acknowledged that the rising bond yields were contributing to tightening financial conditions.

From a technical standpoint, the price appears poised for further gains today, with a potential target at 1.06500 or even extending beyond to 1.06750. The market dynamics are reflecting the influence of the Fed's rate decision and its impact on the US Dollar, leading traders to consider the potential for an extended rally in EUR/USD.

As traders closely monitor these developments, the pair's movement remains a focal point for those seeking opportunities in the currency market.



Our preference

Long positions above 1.05600 with targets at 1.06500 & 1.06750 in extension.

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