FX snapshot: US Dollar Index, GBP/USD, USD/CAD, USD/RUB

Dollar tumbles after Fed decide against hike, bringing expectation of further downside.

Source: Bloomberg

Fed pushes dollar into bearish pattern
The Dollar Index has smashed lower after the Fed kept rates unchanged, bringing with it a more bearish formation. The sharp move lower has created a flagpole, with the move higher looking like a bearish retracement rather than a bullish reversal.

Price has begun to move lower once more and the break below 94.50 is expected to bring yet another move lower. Support below 94.50 would be likely to be found around 94.21 and 93.82. My bearish view would only change with a move above 94.84.

GBP/USD continues to rise, with pullback likely to be short-lived
GBP/USD has retraced lower once more on its upward trajectory seen over the back end of this week. The $1.5552 level is likely to be the key support here for another leg higher and unless price moves below $1.55, I am bullish for another leg higher with the next resistance around $1.5641. However, I would be a little more anxious should price move below $1.5552.

USD/CAD rolling over in bearish manner
USD/CAD is tumbling following a very volatile evening yesterday. The long-term outlook is beginning to turn over, with the break below C$1.312 making it look a lot like we have topped off for a move lower. With this in mind, I would expect a move down towards 1.3, unless price moves back above C$1.3182.

USD/RUB showing signs of a major correction lower
USD/RUB has bounced from the major support level of 64.7, yet is selling off once more towards that pivotal price. The failure to break back above 71.7in early September meant that we have had a warning sign on the cards for the past week or so.

However, for a bearish view to come to fruition, I would need to see a break below 64.7. The likely creation of a bearish engulfing formation points towards a move back to 64.7 and should we see a break and close below that level, I would be expecting a major selloff. The Fibonacci expansion support level at 64.9 is also worth noting as this was the point which saw Wednesday’s bounce higher. It also provides us with a target of 62.2 as the first major support level should price close below 64.7.

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