EUR/USD traders are buying into the dip that has followed Wednesday's Federal Reserve meeting.
Bullish conviction is clearly robust and some traders are prepared to stake cash on a rise, and they are probably wise to do so.
EUR/USD hit a one-month low in the wake of the Fed meeting.
Only the most extreme thinkers could view the Fed as a disappointment.
The central bank has reached a point where it's tough to add to stimulus but the Fed is clearly prepared to do more if necessary nL1N2GD2AW.
Wednesday's EUR/USD reaction is also due to an extreme situation, the number of traders betting on a rally.
That situation needs to be adjusted before the rally can resume in earnest and that's what has been happening since the end of July nL1N2GE05V.
EUR/USD lost momentum at the end of July and profit-taking set in.
Those who sold or those long from the much lower levels trading earlier in July can buy or add to longs with confidence.
Strong support is close by at the daily Ichimoku cloud 1.1695-1.1541.
A drop to the top of the cloud would meet the minimum objective for a technical correction of the rise from June's low.
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