The Euro bounced after repeated probe below 1.1200 in early European hours on Tuesday, but is struggling to sustain gains above 1.1200 handle. Daily Tenkan-sen (1.1225) caps for now, with the downside expected to remain vulnerable while the price stays below 1.1225/35 pivots (Tenkan-sen/10SMA). Tight ranges could be expected ahead of Fed’s policy announcement on Wednesday, with tone of Fed Chair Yellen’s testimony expected to be the key driver of the markets. Dovish tone from Yellen would send dollar lower and boost Euro for renewed attempt towards key med-term barrier at 1.1300 (08 Nov high). Conversely, hawkish Fed, which includes rate hike and signal of sticking to the policy for three hikes in 2017, will be negative for the single currency and risk break below pivotal support at 1.1100 for extended weakness.
Res: 1.1225, 1.1235, 1.1285, 1.1300
Sup: 1.1209, 1.1185, 1.1166, 1.1114
