The EUR/USD pair rose yesterday as Spanish PM Mariano Rajoy’s party retained an absolute majority in the parliament of his home region of Galicia. However, we see that forex market investors prefer to stay on the sidelines ahead of a series of key events. The Federal Open Market Committee begins a 2-day meeting today. The market will focus what Chairman Ben Bernanke is going to say at the press conference. Even though the Fed is likely to hold off from new action after announcing at its last meeting it would buy $40 billion of mortgage-backed bonds a month until the U.S. job market improved, its policy statement on Wednesday will still be closely watched.

Meanwhile, Moody’s Investors Service lowered Catalonia and four other Spanish regions’ credit ratings. A week ago the credit agency lowered Spain’s credit-rating to below investment grade. The ratings firm said its decision to cut the regions was driven by the deterioration in their liquidity positions, as evidenced by their very limited cash reserves as of September 2012 and their significant reliance on short-term credit lines to fund operating needs. The EUR/JPY pair reversed after hitting a three-month high. The Japanese yen has been weakening against its counterparts on growing market expectations for the Bank of Japan to expand its monetary stimulus at a policy meeting next week (October 30).

The Asian stock markets opened higher today lower today after a regional vote in Spain was seen as moving a solution to the euro zone debt crisis one step closer. NIKKEI started the day at 9,066.03, previous close was 9,010.71. HANG SENG is closed today due to a national holiday. CEO of Commons Assets Management, Tetsuro Li said “Everybody knows earnings will be weak, but if companies’ guidance is more cautious than markets expect, then there is a risk that the downside may be tested. While excessive risk aversion has softened, there is nothing to be positive about the global growth slowdown,” Ii said. But he added any dip in markets will be a buying opportunity”

EUR/USD is trading at 1.3024 by the time of typing and for today resistances are located at 1.3082 and 1.3112. Support levels are 1.3000 and 1.2964.

GBP/USD is at 1.6002. Resistance levels are located at 1.6042 and 1.6073. Supports are located at 1.5980 and 1.5945.

USD/CHF is trading at 0.9288 by the time of typing and for today resistances are located at 0.9309 and 0.9340. Support levels are 0.9253 and 0.9214.

AUD/USD is trading at 1.0293. Resistances are located at 1.0337 and 1.0380. Support levels are 1.0280 and 1.0251.

The economic calendar is light today. Statistics Canada will be released Core Retail sales data at 13:30 GMT. Bank of Canada rate statement is due at 14:00 GMT. EU Consumer Confidence report will be released at 15:00 GMT.