Levels in play through the FOMC decision

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Forex — The strongest to weakest of the major currencies

The USD dollar is marginally lower on the day with gains only vs the CHF and declines of 0.20% or more vs the EUR, CAD, AUD (down -0.73%) and NZD. The AUD is the strongest as it has follow through buying after the larger than expected increase in rates yesterday to launch.

Needless to say, the USD has been trending to the upside in 2022 as the Fed embarks on the tightening cycle and concerns about growth in Europe from the Ukraine war favors the dollar over European currencies. Japan meanwhile is intent on keeping their rates lower despite higher inflation.

What levels are in play for some of the major currencies with the FOMC decision:

EURUSD: The EURUSD traded to the upside today and has extended above its 100 hour moving average at 1.05248. That level will be a short-term barometer for the buyers and sellers through the FOMC decision. Move below and the bias tilt more to the downside. Stay above, and the high price from yesterday at 1.05769 followed by the falling 200 hour moving average at 1.05949 would be the upside targets to get to and through. The price of the EURUSD pair has not traded above its 200 moving average since April 22. On the downside a move back below the 100 hour moving average would look toward the lows from Monday and Tuesday near 1.04904. Below that is the lowest level since January 2017 at 1.04703. Move below that low and it opens the door for further downside momentum as the trend in that direction continues.
GBPUSD: The GBPUSD in contrast to the EURUSD, is trading just below its 100 hour MA at 1.2517 . The current price is at 1.2488. The bias is tilted modestly to the downside below that MA level. It would take a move above the moving average to tilt the bias more to the upside. If so, the falling 200 hour moving average comes in at 1.2591. The high from last Friday comes in at 1.26145. That area between 1.2591 and 1.26145 would open the door for a run toward the 38.2% retracement of the move down from the January 21 high at 1.26698. Ultimately would take a move above the 38.2% retracement to give the buyers more confidence in control. On a move to the downside, the low on Monday, Tuesday and today was in a range between 1.2463 and 1.2473. Move below that short term floor and the low from April 28 at 1.24103 (i.e., the cycle low for 2022 and the lowest level since July 2020) would be the downside target that if broken would open the door for more downside momentum.
USDJPY: The USDJPY is stalled in a narrow trading range today and just below its 100 hour moving average at 130.165. The current price is at 130.11. A move above the 100 hour moving average would look toward the Monday high at 130.491. Move above that and traded with start to look toward the high price from last week at 131.246 as the next major target. That level is the highest level in over 20 years. Move above and it opens the door for further gains to the upside and resumption of the upside trend. On the downside, the low price from Monday stalled at the 38.2% retracement of the move up from last week’s low at 1.29597. Move below that level and the rising 200 hour moving average at 129.236 would be the next key target followed by the 50% of the same move up at 129.088. That level also corresponds with the swing hi from April 22. So getting below would open the door for further downside momentum.

In other key markets going into the FOMC decision: