Market's Spotlight

The recent surge of the US Dollar abruptly halted following the Federal Reserve's decision to maintain unchanged interest rates and Chair Powell's dovish message. This caused a decline in the US dollar, boosting riskier assets and overall market sentiment. Despite optimistic GDP and inflation forecasts, the US Dollar Index (DXY) dropped to weekly lows after the Fed's decision.The market surprise stemmed from the Fed's steady interest rate projection for 2024, causing the Dollar's depreciation but supporting modest gains in stocks and lower Treasury yields. Powell's assurances on the Fed's cautious approach to short-term data eased investor concerns. Key upcoming economic releases like Initial Jobless Claims, Philly Fed Manufacturing Index, S&P Global Manufacturing and Services PMIs, CB Leading Index data, Existing Home Sales figures, and an FOMC member's speech will guide market sentiment and the Dollar's direction.Major Currency Pair Movements:AUD/USD: After reversing its downtrend fueled by positive Employment Change and Unemployment Rate figures, AUD/USD is now testing the 0.6610 resistance level, indicating renewed strength in the Australian Dollar against its US counterpart.NZD/USD: Despite New Zealand's weaker Q4 GDP data, NZD/USD has strengthened above the 0.6053 - 0.6071 zone, benefiting from a weaker USD. This resilience suggests underlying bullish sentiment for the New Zealand Dollar.EUR/USD: Climbing to multi-day highs above 1.0921, EUR/USD has capitalized on the pullback in the US Dollar, demonstrating increased demand for the Euro amidst a more favorable market sentiment.GBP/USD: Maintaining its upward trajectory, GBP/USD is currently testing the crucial 1.2800 resistance level, buoyed by the weakness in the US Dollar. This ongoing strength underscores market optimism towards the British Pound.USD/CAD: Trading below the 1.3500 resistance level, USD/CAD remains subdued as investors await the outcome of the Federal Open Market Committee (FOMC) meeting, overshadowing any influence from the Bank of Canada's position.USD/JPY: After challenging the November 2023 resistance and reaching around 151.80, USD/JPY experienced a pullback below 150.80 due to weakness in the US Dollar. This retreat suggests a temporary pause in the recent bullish momentum.USD/CHF: Following a five-day bullish run, USD/CHF has retreated amid a weakened US Dollar, with investors awaiting updates from the Swiss National Bank's policy meeting. This reversal highlights the impact of shifting market dynamics on the Swiss Franc.The Commodities:WTI Crude Oil: Despite concerns over supply disruptions, WTI Crude Oil retreated below the $81.85 support level, reflecting a broader sell-off in the commodity market amidst a decline in the US Dollar.Gold: Breaking out of consolidation, Gold surged to a new all-time high at $2,222.995 per troy ounce, driven by lower US yields and weakness in the US Dollar. This rally underscores investor appetite for safe-haven assets amid uncertain market conditions.Silver: Demonstrating strong gains, Silver tested levels last seen in early December, reaching around $25.60 per ounce. This upward momentum signals renewed interest in the precious metal, driven by similar factors influencing Gold.US Stocks:S&P500 and Dow: Breaking through previous resistance levels from March, both the S&P500 and Dow Jones Industrial Average (Dow) reached new all-time highs, reflecting positive market sentiment and investor optimism. Meanwhile, the NASDAQ Composite Index remains above the key resistance level of $18,286.70, indicating continued strength in the tech-heavy index amidst favorable market conditions.These market movements reflect the complex interplay between central bank actions, economic data, and investor sentiment, shaping current market dynamics.