This morning, the key currency pair EUR/USD trades near to the resistance level of 1.10 by adding 0.1%.
The key driver for pair and for the whole forex market as well, are results of the Federal Reserve meeting.
“A statement to be published Wednesday at 2 p.m. in Washington at the conclusion of the rate-setting Federal Open Market Committee’s two-day gathering will probably acknowledge better news on the economy since the last meeting in mid-June.”, Bloomberg writes.
“But it is expected to fall short of telegraphing that a hike is right around the corner, and there is no post-meeting press conference with Fed Chair Janet Yellen to drop further clues.
Last month, FOMC voters unanimously agreed to leave the target range for the U.S. central bank’s policy rate unchanged at 0.25 percent to 0.5 percent amid uncertainty following a sharp deceleration in U.S. job growth in May, and ahead of the British referendum on European Union membership a few days later on June 23.”
The resistance levels for the Euro are 1.1030 and 1.1058
The support levels for the EUR/USD are following 1.0950 and 1.0908
On Wednesday, the Japanese yen was losing over 1%, , pressured by expectations of further monetary easing by the Bank of Japan and amid media reports that the Japanese government will soon unveil a $265 billion stimulus package.
During the day, the USD/JPY pair was trading above the level of 106.50 yen per dollar. Currently, we are observing a technical correction – the pair trades around the level of 105.70.
As Reuters reports, “The yen fell after Japan's Fuji TV said Prime Minister Shinzo Abe was planning to announce a stimulus package with a headline figure of around 27 trillion yen.
Abe was later quoted by Jiji news agency as saying the stimulus package, to be announced next week, would total more than 28 trillion yen ($265.48 billion), including 13 trillion yen of "fiscal measures".
That would be bigger than earlier reports of a possible headline figure of around 20 trillion yen.”
"We believe that current expectations are for the fiscal package to be done in conjunction with expanded monetary easing," said Lee Jin Yang, macro research analyst for Aberdeen Asset Management in Singapore.
"This belief has been causing dollar/yen volatility with the fluctuations in the reported size of the fiscal stimulus." (Lee Jin Yang)
The resistance levels for the US Dollar are 106.54 and 107.46
The support levels for the USD/JPY pair are following 105.40 and 104.94