EUR/USD is on the bid as the US dollar slides during a dovish Fed presser

• EUR/USD is lifted on US dollar weakness as the markets price in additional stimulus on a dovish Fed. 
• FOMC left rates and bond-buying unchanged. The outcome was fully expected. 

The euro is on the bid with the market’s focus on easing from the Federal Reserve and additional fiscal stimulus which is pressuring the greenback lower this week.

The DXY is trading at 92.5330 at the time of writing vs the low of 92.4880. 

The Federal Open Market Committee’s statement was virtually unchanged, with there just being the slightest of adjustments to its note over economic activity. 

The FOMC has stated that economic activity and employment have ‘continued to recover’ vs ‘picked up’ in the prior statement.

Meanwhile, in the press conference, the Fed’s Chair, Jerome Powell made his opening statement saying, ”the pace of improvement has moderated,” although he noted that economic activity has continued to recover.

However, Powell has stated that the path ahead remains highly uncertain and his concerns could be an additional weight for the greenback with the market’s focus on a large stimulus package. 

Meanwhile, the euro has been undermined by the spread of the coronavirus considering much of Europe is now experiencing higher levels of it than recorded in the spring. 

However, encouragingly, according to Euronews, ”data collected by the European Centre for Disease Prevention and Control, shows there were 88 daily COVID-19 deaths reported by France on October 16.

But at the peak in early April, the country was registering more than 1,000 fatalities over a 24-hour period.”

Nevertheless, markets will be concerned that the spread of the virus will continue to pose serious challenges for an economic recovery that still has a long way to go.

The implication so the lockdowns will hamstring the euro and could expose it to a sell on rallies across the board.

EUR/USD technical analysis

Meanwhile, the euro is advancing after a correction of the bullish impulse as illustrated below:

A fade back to support and a restest could be in order prior to further advances.