EUR/USD sub 1.2000 handle ahead of FOMC

• The EUR/USD is trading below the 1.2000 psychological level ahead of the FOMC statement scheduled for 18:00 GMT.
• The next key event in line after the FOMC will be on Thursday with Eurozone inflation at 9:00 GMT.

The EUR/USD is trading at around 1.1970 down 0.19% ahead of the widely awaited FOMC statement later on Wednesday.

The EUR/USD is under pressure of expectations for the hawkish turn from Fed in its monetary policy statement scheduled for 18:00 GMT. 

There is no rate hike expected today, however, the Federal Reserve is expected to keep its hawkish stance and prepare the market for a rate hike in June. The 10-year Treasury yields benchmark has been boosted as a reflection of the recent monetary policy. The United States is benefitting from a strong labor market and rising inflation indices including core PCE rising 1.9% y/y and the ISM's prices gauge rising strongly.

The EUR/USD has breached the key psychological level of 1.2000 and if the FOMC statement at 18:00 GMT is hawkish the single currency can continue its bear trend further. 

The recent lackluster data in the Eurozone have shed a negative sentiment on the euro and if the inflation data on Thursday (Consumer Price Index) come below expectations traders will probably throw in the towel on parts of their long positions.

EUR/USD 4-hour chart 

The trend is bearish and immediate support is seen at 1.1952 low of the day and at the 1.1900 figure and swing low back in January. Resistance is priced in at the 1.2000 figure and at 1.2054 swing low. Further up the 1.2100 figure is also seen as resistance.