Daily FX Analysis: FOMC Kills Risk, Key Level for Euro

The day started a little more interestingly with UK MPC minutes highlighting that 3 people, including good ol Merv, were keen to increase bond purchases and hence more QE in the UK, this promptly allowed the pound to decline further.

We also saw Spain on the wires down talking the recovery and additional challenges it faces.

Later in the afternoon we then had the FOMC minutes pointing to the fact that the Fed could end QE and its Asset Purchase program without ever having reached its unemployment target. This bolstered the Dollar and sent risk pairs tumbling.

To top it off we also had rumours of a Commodity Fund in trouble causing forced liquidation of its positions.

EUR/USD
Euro dropped rapidly to the potential support level today. Given the comments from the FOMC and Eurozone memebrs (particularly Spain) general sentiment is pretty Bearish the Euro right now.
For the time being I hold my Bullish stance and now see value if we get clear signals on the 4hr or daily chart to re-enter the market long.; however that said, we now sit in a very key support area, if the pair falls further from here then we could see a much broader reversal, in which case we could look for sell signals on a test of previous support turned resistance.
Personal Bias: Bullish / Neutral
Support: 1.3285 / 1.3160
Resistance: 1.3400
My Strategy: Stand aside, wait for clear signals.



GBP/USD
Pound plummeted today, both the MPC minutes and FOMC minutes playing their part. We did highlight previously that we suspected this was going all the way down to the 1.5200 handle and we got there pretty quickly.
Interesting to see where this now heads, it could find some interim support here, but the pair still looks really weak.
Personal Bias: Bearish
Support: 1.5230 / ????
Resistance: 1.5455
My Strategy: Look for sell signals on any retracements higher


AUD/USD
Aussie dropped with other risk pairs today. Pair didn't quite reach our target area for shorts but has dropped down to weekly lows again. Like others here this current level could provide some support, if it does we would look for selling opportunities on any retracements higher.
Personal Bias: Bearish
Support: 1.0230
Resistance: 1.0350
My Strategy: Stand aside


USD/JPY
Dollar yen had pushed higher initially today but chopped around on a sell off from the FOMC minutes.
Currently in a consolidation mode we are awaiting clear signals.
Personal Bias: Neutral
Support: 92.00 / 91.00 / 88.00
Resistance: 95.00
My Strategy: Watch key levels of 95.00 and 92.00 for signals.