The pair traded a a $1.2631 low last night in the US following the FOMC decision, and then closed the session marginally above that low at $1.2632. The Fed announced the end of QE as expected last night and the decision/statement was deemed a bit less dovish than the market expected, resulting in a rise in US Treasury yields and the dollar. The euro took back some ground just after the open this morning, climbing to $1.2639 before reversing direction. Euro-dollar then encountered further selling pressure as the dollar’s gains resumed this morning and was soon driven through the US low. It paused briefly around the $1.2620 mark but that gave way also for a $1.2616 low. Euro-dollar losses continued in the afternoon as it then dropped further through a series of option expiry levels, most notably at $1.2600. It eventually traded a $1.2589 low ahead of the European open, and currently remains near that low, at $1.2595. The sharp move lower following the less dovish than expected FOMC statement sees the immediate focus move through the $1.2584-1.2605 region and on to the $1.2501 2014 low beneath.
