CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Please ensure you fully understand the risks involved. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Please ensure you fully understand the risks involved.

Post-FOMC moves spark volatility in EUR/USD, GBP/USD and USD/JPY

Initial USD weakness in the wake of the Fed meeting has given way to a recovery for the greenback, prompting price gyrations in key FX pairs.

EUR/USD stuck below $1.20

A close above $1.20 still eludes the EUR/USD pair, which is struggling to make headway despite the rally from last week’s lows. A more bullish view requires a break above this level, opening the path to trendline resistance from the January high, likely around $1.21.

With rising stochastics and a potential bullish moving average convergence divergence (MACD) crossover the longer-term uptrend may well have been revived, with a more bearish view requiring a reversal back below $1.19 at the least.

GBP/USD recovering in wake of FOMC

The past two sessions have seen a strong recovery that has arguably revived the uptrend. The 50-day simple moving average (SMA) at ($1.3813) remains untested once again, but with a higher low now in play a move back towards $1.42 and the latest higher high seems likely.

Sellers were unable to drive the price below $1.38, leaving the buyers to dictate the move, and with a weakening of the US dollar in the wake of the Federal Open Market Committee (FOMC) meeting the way seems clear for further upside.

USD/JPY fights to hold gains

The USD/JPY pair continues to grudgingly give back some of its gains, but we have seen four days where the price has ended well off the highs but firmly above the lows, a sign of how closely-fought these moves have been.

The trend change from earlier in the year remains intact, so even a bigger drop towards ¥107 would not necessarily change the overall outlook, but it might be time for USD/JPY to finally see a move to the downside after the huge gains of January and February.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

Start trading forex today

Trade the largest and most volatile financial market in the world.

  • Spreads start at just 0.6 points on EUR/USD
  • Analyse market movements with our essential selection of charts
  • Speculate from a range of platforms, including on mobile

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. All share prices are delayed by at least 20 minutes. Prices are indicative only.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.