Overall, the currency market saw some pretty wild swings after the Federal Open Market Committee decided to keep the overnight lending rate at the historical low of 0-0.25 percent. The news was announced in the late U.S. session. Earlier in the session the Commerce Department released a report stating that the trade deficit for the United States reached 27 billion, an increase of 4 percent.
The euro (Eur/Usd) has taken another run at the 20 day moving average of 1.4214 after the Fed announced that interest rates will remain on hold. This level is also near where the R2 resistance pivot point is located, adding a double barrier to further movement during the session. The pair has managed to gain 63 pips from the open or 0.45 percent.
The pound (Gbp/Usd) has been all over the chart but has not managed to produce much of a gain. The pair started the session by weakening and falling below the low of the previous two days and the 50 day moving average only to rebound and break above the high of the previous day to get within 10 pips of its 20 day moving average. After the interest rate decision was released, the pound tested the 50 day moving average again, unable to hold below as it shot back up and found resistance at the R1 pivot point.
The aussie (Aud/Usd) has managed to strengthen by 52 pips or 0.63 percent on the day. Early in the session the pair broke below the 20 day moving average. A short time later the pair reversed course and managed to trade 80 pips above that area just before the FOMC statement. After a wild ride the pair is back to pre-FOMC levels finding minor support in the .8330 area.
The cad (Usd/Cad) has decided to take a break from the impressive run it has been on since August 4th. The pair broke down to the 50% Fibonacci retracement at 1.0850, and is currently finding resistance at the 38.2 level near 1.0900 as well as near the pairs 20 day moving average located at 1.0888. The loonie shed 133 pips or 1.22 percent today.
The swissy (Usd/Chf) has declined for a second day today as the pair fell below the 50 day moving average which had previously held as support. The swissy got within 10 pips of the 20 day moving average before the FOMC statement. The pair will close the day out with a 40 pip loss, or 0.42 percent.
The yen (Usd/Jpy) barely made a significant change on the day despite testing the major moving averages. Early in the session the pair broke below the 50 day moving average before going down further to test the 20 and 200 day moving averages which are both near the 95.10 level. This must be a protected area since price then flew up to test the 100 day moving average at 96.60. On the day the pair has posted an 8 pip gain, or 0.08 percent.