Being the focus earlier this morning, the results of the FOMC meeting were in line with market forecasts when the Federal Reserve (Fed) raised interest rates from 0.25% to 0.50%.
This is the first rate hike since 2018 and policymakers see a series of more hikes to take place until the end of 2022 with 6 more meetings left for the year.
Still, it was somewhat disappointing for investors when expectations for the US dollar to strengthen after a rate hike by the Fed, faltered. The US dollar ended the New York session trading with a dismal movement.
Analysts see this situation as normal even contrary to the usual strengthening of the currency that occurs after the rate hike by the central bank.
As investors have received indications for policy tightening that will strengthen the US dollar for a longer period, it is likely that profit taking will occur for US dollar buying positions by market players earlier before the meeting.
And it is expected that the US dollar will strengthen again as early as next week, but also depends on the development of current issues such as the Russian-Ukrainian war crisis that affects market sentiment.
On the price chart of the EUR/USD pair, failing to continue the lower decline, the price has exhibited a bullish pattern that surpassed the 1.1000 level.
Also giving a signal to move in a bullish trend, the price remains supported by the Moving Average 50 (MA50) support level on the 1 -hour time frame.
For higher expectations, the level around 1.11200-1.11400 SBR zone (support become resistance) will be tested before heading to the next focus level around 1.12000.
But beware if the US dollar gets back on track to start strengthening, a change in price trend is expected.
A drop below the 1.10000 level as well as the MA50 support level will push the expectation of a lower price decline heading back to the support zone at 1.0800 which has been the focus of early trading last week.
