The GBP/USD has at least 200-300 points of room to rally before it reaches a key technical resistance level and fundamentally, the market expects the Bank of England to raise interest rates this Thursday to 5.75 percent.

The last trading of the second quarter lived up to its reputation for delivering sharp volatility to the financial markets.

The Federal Reserve monetary policy meeting is now behind us and with no major changes to inflation outlook and growth assessment, the impact on the currency market has been limited.

Kathy Lien takes a closer look at today's Fed annoucement.

Federal Reserve interest rate announcements have traditionally been big market movers for the US dollar. However in recent months, the market moving-ness of this event risk has been downgraded significantly since the Federal Reserve’s monetary policy has become as predictable as the passage of time.

The US dollar has strengthened ahead of the FOMC meeting despite the larger than expected drop in durable goods orders in the month of May. The US economy is clearly facing problems as the weakness in durable goods follow disappointments in both existing and new home sales.

Softer economic data weighed on the US dollar today but the shallowness of the decline is a testament to the market’s overall demand for risk as well as its tolerance for US dollars.

Relatively mixed on the day, the US dollar was neither stronger nor weaker against the majors as conflicting sentiment helped to keep the greenback in neutrality.

The snapback in the Dow Jones Industrial Average today was nothing short of impressive.

Carry trades continued to rule the currency market as the New Zealand dollar and British pound hit fresh 17- and 15-year highs against the Japanese yen.