SpotEuro Forex Daily Outlook November 4, 2010

$600 billion with reinvestment of another $300 billion. That seems to be the Federal Reserve's plan for through Q2 of 2011. The market reacted just like we anticipated, a lot of volatility with a lot of misdirection. Within 1 minute, the EUR/USD pair was 150 pips higher followed by 170 pip reversal during the next 5 minutes that set a lower daily low. Thirty minutes after the FOMC announcement the market calmed down and slowly regained composure to continue selling the dollar, though much more slowly. Not too many agreed with the Fed's decision but Bernanke has studied this all his life. What do we know? We'll see how London handles the news next. Also up on deck is the ECB press conference and traders need to hear of an exit strategy from Trichet.

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