It seems that markets finally got what they were waiting for. The Fed said they will start reducing the pace of interest rate hikes, which signals the likely end of the bear market. US stocks promptly rose after the news, while Treasury yields and dollar fell. Also, are now expecting a 0.50% rate increase markets in December, instead of the previous 0.75%.
Unsurprisingly, the optimism extended to today's European session, as evidenced by the dynamics in the stock markets of both Europe and the US. It may also continue tomorrow despite the early closing of many markets due to the Thanksgiving holiday in the US, as well as next week.
In the forex market, there is a further weakening in dollar, but low volumes due to the holiday may limit, if not halt, it.
The easing of interest rate hikes early next year could signal a shift in market trend.
Forecasts for today:
EUR/USD
The pair rose, thanks to the announcement of the Fed that they will start reducing the pace of interest rate hikes in the near future. If traders manage to push it above 1.0450, quotes will climb further to 1.0580.
USD/JPY
The pair is trading above the support level of 138.45. Increased positive sentiment in the markets will put pressure on dollar, which could lead to a drop to 136.50.
