The EUR/USD pair initially fell to 1.0960, but then surged to 1.1064

EUR/USD

The key event today was meant to be the July FOMC monetary policy meeting in the US, but upcoming stimulus programs in Japan are also to be blamed for what happened this Wednesday.  The day started with news pointing for a more than 28 trillion yen fiscal stimulus package, and the emission of 50-year bonds by the Japanese government. The Minister of Finance, Taro Aso, denied this last one, but Abe confirmed the first, triggering wild swings during the Asian session that ended up benefiting the greenback. The market entered then wait-and-see mode ahead of the US Central Bank decision, which left rates unchanged, but issued an upbeat assessment of economic conditions, remarking that the "near term risk to the economic outlook have diminished."  Investors rushed to buy the greenback after the announcement, but the greenback reversed gains as markets still don't believe a September higher is likely.

The EUR/USD pair initially fell to 1.0960, but then surged to 1.1064, holding above the 1.1000 level by the end of the US session, but trapped within its early week range. The limited upward momentum has sent the price above a short term descendant trend line coming from July 14th high at 1.1164, but given that it's still struggling to overcome the 1.1050/60 region, further gains seem unlikely. In the 4 hours chart, the price is above its 20 SMA, but below the 100 SMA, this last around 1.1050, while the technical indicators head modestly higher above their mid-lines, with no certain upward strength. The pair maintains a neutral-to-bearish stance, although a break below 1.0910 is required to confirm a new leg lower, while above the 1.1100 figure, the pair can extend up to the 1.1190 level, the post-Brexit high. 

Support levels: 1.0990 1.0955 1.0910 

Resistance levels: 1.1060 1.1100 1.1145

USD/JPY

The USD/JPY pair settled around 105.50 after the wild swings suffered early Wednesday, showing a limited reaction to FED's announcement, as the pair is being driven mostly by the many twists and turns of Japanese authorities. The YEN plummeted amid stimulus package details were unveiled by PM Abe, who agreed  a fiscal stimulus package of over JPY 28trn, to be announced early August. At the same time, there rumors making the rounds of a plan to issue  50-year JGB plan in the coming days, later denied by FM Taro Aso. The pair jumped to a daily high of 106.53, before retreating, with the upside being limited later on the day by poor US data, as June Durable Goods Orders came in much worse-than-expected, falling by 4.0%. The pair will likely enter now in wait-and-see mode ahead of the upcoming BOJ's meeting early Friday, but the short term picture favors the downside, as in the 1 hour chart, the price was unable to  settle above its moving averages, whilst the technical indicators head south around their mid-lines. In the 4 hours chart, the price is holding above its 100 and 200 SMAs, but the technical indicators hold flat within negative territory, supporting the case for further consolidation ahead. 

Support levels:  105.10 104.60 104.20 

Resistance levels: 106.10 106.60 107.00

GBP/USD

The British Pound was among the most benefited following FED's announcement, as the GBP/USD pair recovered above the 1.3200 level, reaching a fresh weekly high of 1.3229. The  Sterling remained muted early Europe after the release of a better-than-expected Q2 GDP, showing that the economy grew by 0.6% in the three months to June, against previous 0.4%. Yearly basis, the reading was also upbeat, up to 2.2% against previous 2.0%. Still,  data reflected a pre-referendum scenario, and it won't be until the release of the Q3 GDP that the market will have a clearer picture of the UK economic growth. Now trading near the mentioned high, the short term technical picture is bullish, as in the 1 hour chart, the technical indicators head sharply higher near overbought levels, whilst the 20 SMA is turning modestly higher far below the current level, as a reaction to the over 100 pips advance. In the 4 hours chart, the price has settled and advanced above a still flat 20 SMA, while the RSI indicator accelerated higher, now around 63, but the Momentum indicator holds flat within neutral territory. The pair can extend its advance up to 1.3220, the 23.6% retracement of the post-Brexit slump, although selling interest around the level is expected to contain the advance. 

Support levels: 1.3165 1.3120 1.3070 

Resistance levels: 1.3230 1.3280 1.3320 

AUD/USD

The AUD/USD pair closed the day in the red below the 0.7500 level, suggesting bulls are starting to give up on the Aussie. The release of Q2 inflation data earlier in the day diminished chances of a RBA rate cut in the near term, as trimmed CPI in the quarter came in at 1.7%, beating expectations of 1.5%. The news sent the pair briefly higher up to 0.7653, but the fact that pair was unable to hold on to gains supports the case for some further declines ahead. Dollar's temporal strength post-FED sent the pair down to 0.7420, adding to the bearish case. Short term, however, technical indicators recovered from near oversold readings in the 1 hour chart, and the price is above a bearish 20 SMA, while the price is also holding above 0.7450, a major Fibonacci support, limiting the downward risk. In the 4 hours chart, the price is hovering around the 20 SMA and the 200 EMA, both horizontals and around 0.7485, while the technical indicators head modestly higher above their mid-lines, but with limited upward strength. 

Support levels: 0.7450 0.7410 0.7330

Resistance levels: 0.7530 0.7580 0.7625

Dow Jones

Wall Street ended the day mixed, with the DJIA practically unchanged, down by 1 point to 18.472.17. The S&P also lost some ground, down by 0.12% to end at 2,166.58, but the Nasdaq Composite added 29 points, closing in the green at 5,139.81. Despite some strong earnings reports, stocks opened with a negative tone in the US, advancing after the FED but unable to hold on to gains after the close. Facebook reported strong earnings after the close, a net income of  $2.06 billion, or 71 cents a share, compared with $719 million or 25 cents per share a year ago, while Groupon jumped over 22% after informing a smaller-than-forecast loss and raised its revenue outlook.  Apple closed the day 6.75% after a strong report late Tuesday, while Twitter lead the decline, falling roughly 15% on poor sales. From a technical point of view, the daily chart for the index shows that technical indicators extended their declines within positive territory but that the benchmark holds well above a still bullish 20 SMA. In the 4 hours chart, the index stands a few points below a modestly bearish 20 SMA, while the RSI indicator turned south around its mid-line, increasing chances of a downward extension, although a break below 18,387 this week low, is required to  confirm further slides. 

Support levels: 18,456 18,387 18,313

Resistance levels: 18,520 18,571 18,640

FTSE 100

The FTSE 100 extended its gains by 0.39% this Wednesday, closing the day at 6,750.43, advancing intraday up to 6.783, its highest in a year. A strong Q2 GDP reading bolstered the Footsie, also helped by strong earnings results. Leading the advances were Barratt Developments, up by 6.81% and ITV, the TV giant that added 6.76% after reporting a 9% increase in adjusted profit before taxes to £425 million, for the first six months of 2016. The index retreated back into its latest range during US trading hours, and stands now around 6,740, with the daily chart showing that it holds well above a bullish 20 SMA, while the technical indicators remain flat well above their mid-lines, indicating a limited downward risk. Shorter term, the 4 hours chart continues presenting a neutral stance, with the index now standing a few points above a horizontal 20 SMA and the technical indicators heading modestly lower within neutral territory.  

Support levels: 6,703 6,668 6,615 

Resistance levels: 6,752 6,806 6,850

DAX

The German DAX surged 72 points or 0.70%, ending the day at 10,319.55, a fresh 2-month high, and finally erasing all of its post-Brexit losses. Renewed hopes of large easing coming from Japan fueled demand for high yielders this Wednesday, although the index retreated below the 10,300 mark on Wall Street's tepid performance. Bayer was among the biggest winners, ending the day up by around 2.5% after upgrading its growth forecast for the year. Puma, the sportswear firm also reported strong earnings, but BASF and Deutsche Bank plunged as net income for both companies declined more than expected. The daily chart shows that the benchmark is currently a few points above the roof of the daily descendant channel, while the technical indicators maintain their bullish slopes near overbought territory, supporting an upward continuation as long as above 10,260, the immediate support. In the 4 hours chart, the RSI indicator retreated from overbought levels, but the index holds above a bullish 20 SMA, as the Momentum indicator consolidates above its mid-line, also supporting additional gains ahead. 

Support levels: 10,260 10,213 10,165 

Resistance levels: 10,351 10,400 10,460

Nikkei

Asian shares closed generally higher, with the Nikkei 225 outperforming its pairs, surging 1.72% or 286 points to close the day at 16.664.82, boosted by fresh hopes of massive stimulus, after PM Abe announced a 28T yen stimulus package. The Japanese currency plunged with the news, with export-oriented shares leading the advance. The biggest winner was Mitsumi Electric Co., up by 16. 46%, followed by Shin-Etsu Chemical Co., up by 14.51% after reporting strong second quarter results. The benchmark shed some ground in after hours trading as Wall Street ended the day mute, but in the daily chart, technical readings retain the positive tone, as the index keeps developing above its 20 and 100 DMAs, whilst indicators head north within positive territory. In the 4 hours chart, the 20 SMA is now horizontal around 16,562, the Momentum indicator keeps hovering around its 100 level, while the RSI indicator heads lower around 52, indicating the index may extend its decline during the upcoming hours. 

Support levels: 16,562 16,475 16,402

Resistance levels: 16,692 16,772 16,840 

Gold

Gold prices soared to fresh 2-week highs as speculative interest assessed limited chances of a rate hike in the US for this year following the latest FED's statement, with spot gold up to $1,341.90 a troy ounce, ending the day a few cents below it. The commodity broke its range towards the upside,  as despite the US Central Bank suggested that the economy is growing  and that global risks have diminished, markets still believes that the picture is not enough to make for a rate hike before the elections in the US. Technically, the daily chart shows that the price recovered above the 23.6% retracement of its latest bullish run, but stalled right around a flat 20 SMA, while the technical indicators head north around their mid-lines, with the RSI indicator already heading north around 55, indicating the rally may now extend. In the 4 hours chart, the price is well above its 20 and 100 SMAs, both converging around 1,320.70, while the technical indicators head sharply higher well above their mid-lines, supporting the longer term perspective. 

Support levels: 1,333.50 1,320.70 1,308.00    

Resistance levels: 1,342.50 1,354.90 1,365.90

WTI Crude Oil

Crude oil prices plummeted mid American session, with WTI ending the day around $42.00 a barrel. Oil came under pressure after the US Energy Information Administration reported that crude inventories rose by 1.7 million barrels in the week ending July 22nd, well beyond the expected drop of 2.3 million. Gasoline stocks also rose, up by 452K barrels, against expectations of a buildup of 40K. WTI traded as low as 41.65, level last seen on April 20th, retaining a strong bearish momentum in the daily chart that points for a test of the critical 40.00 region during the upcoming days. The commodity has closed in the red for five days in-a-row, and in the mentioned time frame, the 20 DMA keeps extending its decline below the 100 DMA, both above the current level, while the technical indicators head south within bearish territory, with the 200 DMA around 40.30. In the shorter term,  and according to the 4 hours chart, the risk is also towards the downside, with the RSI indicator heading lower around 22 and a sharply bearish 20 SMA containing rallies, now around 43.10.

Support levels: 41.65 40.90 40.30

Resistance levels: 42.50 43.10 43.80