EURUSD – close below cloud top / 55SMA was bearish signal/ Fed decision would be next strong driver

The Euro bounces from three-week low at 1.2240 on Wednesday, after suffering heavy losses the day before, on fall from 1.2354 to 1.2240.
Tuesday’s penetration of thick daily cloud and close below key points at 1.2295/65 (cloud top / 55SMAand Fibo 61.8% of 1.2154/1.2445 rally), was bearish signal.
Bearish daily techs favor further weakness, with current upside action seen as positioning.
The action is expected to stay capped by daily cloud top / 55SMA to keep bearish structure (reinforced by formation of 10/30 and 10/20SMA bears crosses) intact.
Break through initial supports at 1.2240 (Tuesday’s low) and 1.2223 (Fibo 76.4% of 1.2154/1.2445) is needed to open way towards 1.2154 (01 Mar low), with stronger acceleration to look for test of 1.2068 (rising 100SMA).
Conversely, close above cloud top / 55SMA would ease bearish pressure, but stronger bullish signals could be expected on close above cluster of MA’s (10/20/30) at 1.2315/26 zone.
US Federal Reserve is ending its two-day monetary policy meeting today and will announce its decision later today.
Markets widely expect Fed to increase interest rates by 0.25%, on central bank’s first policy meeting under new chair person Jerome Powell, but focus will be on the press conference, as traders look for more signals about Fed’s next steps.
Fed announced three rate hikes in 2018, but strong signals about more aggressive approach have been sent and markets will be looking for signs possible four hikes this year.

Res: 1.2295; 1.2315; 1.2326; 1.2355
Sup: 1.2265; 1.2240; 1.2223; 1.2205