EUR/USD ahead of FOMC meeting: Hike or not hike?

Hike rates or not? Traders will be waiting for an answer to be given during today’s Fed interest rate decision at 18:00 GMT and press conference by its chairwoman, Janet Yellen. According to the recent odds by CME Watch, the chance to see an increase in the rates is 22% for today and 58.2% in December and it looks like the markets have been pricing it since several weeks ago. However, with that being said, high volatility is expected as the uncertainty is on the air and several analysts don’t agree on timing for a rate hike by the Federal Reserve.

The technical picture for EUR/USD at H4 chart is showing that the pair is supported by a bullish trend line draw from July 27th lows. Also, we’re seeing a bearish consolidation below the 200 SMA and eventually we may see a rebound towards the resistance zone of 1.1239 ahead of the Fed’s meeting. With a hawkish scenario and a rate hike, EUR/USD may plummet towards the support zone of 1.1076 on a first degree, while a dovish stance by Yellen should drive the pair to the resistance level of 1.1297.