1.Yesterday’s FOMC meeting caused the Dollar to jump higher across the board
as it indicated that the FED is indeed planning one more interest rate hike in 2017. As expected, policy makers left the benchmark interest rate unchanged in a range of 1 percent to 1.25 percent.
2. After the solid CPI data last week, December will still be a likely opportune meeting for them to raise rates
and traders now see 70% probability of this, so USDX may grind higher still.
3.EUR/USD tumbled from about 1.20 to the 1.1862 area and closed the session at 1.1892.
USD/JPY jumped to the mid 112 area and finished at 112.22. GBPUSD dropped from 1.3655 are to as low as 1.3452. It trades now at 1.3507. Please also note that ECB Draghi speaks twice in the coming 24 hours so be aware that there is a potential for a snap back above 1.1900 also.
4. Major U.S. share indexes recovered quickly from initial losses
following the Fed’s announcement, with the S&P 500 ending slightly higher, helped in part by gains in financials and energy shares.
5. Gold collapsed as the USD shone bright after the Fed press conference.
Their pathways towards likely December rate hike is lifting the Dollar, which savagely pulls Gold down. The general positioning in the USD leading into the unknown of the FOMC helped lift Gold yesterday, but now that the markets have a clearer path on Fed forward guidance into 2018, Gold was sold down from 1316 to see sub-1300 levels hold. The Gold buyers need negative headlines out of North Korea to rally XAU once again