The dollar slipped after the Fed held rates, disappointing traders who had priced a chance of a hike. USD/JPY bounced near 162, while USD/CAD stalled at the 50-day EMA.
Alpha Score of 62 reflects moderate overall profile with moderate momentum, weak value, strong quality, moderate sentiment.
The dollar slipped in early Asian trade Thursday after the Federal Reserve left rates unchanged, disappointing a minority of traders who had priced a chance of a hike.
Fed funds futures had, at one point, implied a 40% probability of a hike, the CME's FedWatch tool showed. The actual hold left those bets wrong-footed, and the dollar index gave up about 0.3% in the first hour after the statement.
The selling ran out of steam near 162 yen. USD/JPY bounced from just above that level, a line several Tokyo-based traders said drew buying from both leveraged accounts and corporate hedgers. The 50-day moving average is converging on 162 from above, compressing the band where local support and resistance sit. The interest rate differential between US and Japanese government bonds remains wide, and the carry continues to pay long-dollar holders roughly 4.5% annualised at current yields.
Against the Canadian dollar, USD/CAD stalled at the 50-day EMA, roughly 1.4030, after slipping from 1.4100. The 1.40 round number was resistance on the way up in late March; a Vancouver-based corporate FX desk said its order book showed bids clustered just above that level from importers. The price has flattened over the past six sessions rather than accelerating lower, a pattern some traders read as stabilisation.
The Swiss franc saw the choppiest action. USD/CHF swung in a 40-pip range overnight but held above 0.9100, where a year's worth of resistance now acts as floor. "The differential still pays you to be long dollars, and the franc is the lowest-yielding G10 currency," a London spot trader said. That view kept dips shallow. The pair is trading near the top of a congestion zone that dates to mid-2023, and a close above 0.9200 would run into little chart-based selling until 0.9500, levels seen two years ago.
The dollar's move ultimately came down to disappointment over a single risk that did not materialise. The underlying rate advantage for the US remains intact against every G10 peer. Momentum is sideways, and the floor under the dollar is the carry.
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