EURUSD surged more than 100 pips after dovish Fed meeting minutes. It indicates that a "substantial majority of participants judged that a slowing in the pace of increase would likely soon be appropriate,". Markets eye ECB meeting minutes for further direction. It hits an intraday high of 1.00485 and is currently trading around 1.04143.
German IFO business index came at 86.3 in Nov from 84.50 in Nov compared to a forecast of 85.
According to the CME Fed watch tool, the probability of a 75 bpbs rate hike in Dec increased to 24.2% from 14.6% a week ago.
The US 10-year yield declined more than 3.5% after hitting a low of 3.671%. The US 10 and 2-year spread widened to -78 basis points from -57 bpbs.
Technical:
On the higher side, near-term resistance is around 1.0450 and any convincing breach above will drag the pair to the next level of 1.0550/1.06450.
The pair's immediate support is at 1.0380, breaking below targets of 1.0300/1.02700.
Indicator (4-hour chart)
Directional movement index – Bullish
It is good to buy on dips around 1.0370 with SL around 1.0300 for a TP of 1.0550.
