What a day we had yesterday, in the aftermath of the FOMC meeting and the ��bold and beautiful�� announcement by Ben Bernanke which left the markets shocked by the fact the bank was buying $300B in treasury bonds in order to revive the economy! That move was not expected by market participants and therefore traders showed their respect by making wild currency market, futures and equities moves all over the world! The victim of latest efforts by Bernanke and co. was the dollar, as it was easily sold off and lost more than 200 points against the euro and the pound!

The EUR/USD skyrocketed after the announcement and it makes one think the dollar bears were ready to hit it no matter what! The pair reached important psychological resistance of 1.3530 and since then consolidated 100 points down, but now looks poised for more gains. As long as it trades above 1.3360 there is still a risk to the upside during the day!

The markets showed the FED they are ready to welcome their efforts and if that means buying 300 dollars in Treasuries, then so be it! Bernanke and others are trying desperately not to let this recession escalate, but with interest rates so close to zero, everything indicates a need for great vigilance regarding deflation over the coming months - hence the unusual decision to print more money to tackle our economic woes. One could say that this move was well timed to come at a point when markets were fed up and angry with latest AIG bonus scandal, and it worked so far as a diverting our attention towards something else! Should we think more of it? Or should we let it lie and enjoy the prospect of a better economic tomorrow? All will be answered in the coming days; however traders in a euphoric mood after yesterday��s decision may need more proof the economy will get better, so the coming days will show us if the current rally still has life in it, or whether it��s just waiting to fade away, taken back from risk aversion once again!

So, let��s watch for further reaction today as it would be nice for the market to go back to basics, where fundamentals actually work and when things are grim and dismal for the US economy, the dollar gets punished��