The Euro stands at the back foot in early Wednesday’s trading, following previous day’s close in red and fourth straight failure to close above falling 55SMA. Firmer dollar ahead of today’s FOMC rate decision adds to rising pressure on the single currency.
The Fed is widely expected to increase interest rates on two-day meeting which ends today, but traders are looking for the tone of the central bank to get more clues about the next steps, regarding the third and possibly fourth rate hike this year.
Hawkish tone from Fed would further pressure Euro for attack at key near-term supports at 1.1720 (20SMA) and 1.1713 (Fibo 38.2% of 1.1509/1.1839 upleg), loss of which would be strong bearish signal.
Daily techs are weakening as momentum turned south and MA’s turning to bearish setup and keeping negative near-term tone.
Falling 30SMA maintains pressure and marks key barrier (1.1780), break of which would ease downside pressure.
EU industrial production is the highlight of the European session and could put the Euro under fresh pressure if release comes in line or below the forecast (Apr f/c -0.5% vs Mar 0.5%).
Res: 1.1753, 1.1780, 1.1809, 1.1839
Sup: 1.1720, 1.1713, 1.1674, 1.1652
