EUR/USD (a 4-hour chart)
The dollar grew against most major currencies yesterday before the long-awaited the Fed decision about the monetary policy . The Federal Reserve Open Market began a two-day meeting on Tuesday, and most economists expect the Central Bank to support its incentive programs.
Nevertheless investors will parse comments from Fed Chairman Ben Bernanke following the meeting and to seek out any signals about what changes may appear in the near future.
The markets have been volatile, as Mr. Bernanke discussed the possibility of initiating clotting Fed $85 billion in monthly purchases of assets last month which stimulate the U.S. stock markets and support the economic recovery ...
At the May meeting of the committee Bernanke said the Fed may begin to curtail purchases of assets at a future meeting. As you know, buying bonds, the Fed implemented, putting pressure on the U.S. currency.
Euro continued to grow against the dollar and hit a new four-month high. ZEW index of economic sentiment in Germany in June rose by 2.1 points to 38.5. Economists waited for 38.1.
Yesterday's Fed decision on the size of quantitative easing is the most important piece of information expected by the market. Stock market investors are prepared to press the button "Sell" at the time, as the U.S. dollar bulls want to "Buy, Buy, Buy."