Narrow consolidation below daily cloud awaits Fed’s decision

The Euro is holding within consolidation range just above new two-week low at 1.1181, posted after dovish comments from ECB President Draghi and downbeat German ZEW data.
Tuesday’s close below the base of thick daily cloud was negative signal, however, the pair did not extend weakness below post-data low, as traders await fresh signals from Fed later today.
Studies are mixed, with daily MA’s in bearish configuration, flat RSI, but existing bullish momentum and stochastic turning up in oversold territory.
The US central bank is expected to keep interest rates unchanged at the end of two-day policy meeting, but dovish turn in Fed expectations limits dollar’s gains.
Market expectations are for two 0.25% rate cuts by the end of the year and the Fed will face difficulties in handling such dovish expectations, unless they opt for rate cut, which will be a big surprise.
The single currency is expected to maintain bearish bias while holding below daily cloud that would include test of Fibo support at 1.1170 and possible further bearish acceleration on break.
Conversely, return and close within daily cloud and extension above a cluster of daily MA’s (1.1212/24 zone) would sideline immediate downside risk.

Res: 1.1208; 1.1224; 1.1247; 1.1262
Sup: 1.1181; 1.1170; 1.1160; 1.1134