FED is finally here, and as expected, they leave rates unchanged, adding that “the Committee continues to anticipate that economic conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period.” Also, they added that ”Economic activity has picked up following its severe downturn,” and “conditions in financial markets have improved further, and activity in the housing sector has increased.” rates will remain low as ”the Committee expects that inflation will remain subdued for some time.” First reaction has send dollar down across the board, yet not under previous daily lows, with U.S. stocks rising strongly printing fresh yearly highs, S&P at 1079 and DJIA at 9917. Gold also spike to the 1018 level, but all, majors, stocks and gold retreat from highs.
Maybe we could see some profit taking, or position covering, yet news are no good for dollar. A trend reversal keeps diluting after this report; let’s see how the end days, yet if majors keep hovering around daily highs dollar could extend the fall in the midterm.
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