EUR/USD Forecast: lower ahead of Yellen

As investors eagerly wait for FED´s head, Janet Yellen, markets come back to life, following the long Easter weekend. European equities opened higher, in spite the Japanese benchmark fell, on poor local data and news that PM Abe is ready to go ahead of with the planned hike to the sales tax, despite the latest rumors on the contrary.

Commodities are slightly lower, and so does the EUR/USD pair, this last unable to extend beyond the 1.1200 figure, and down some 30 pips ever since the London opening. Data so far showed that in the EU, the annual growth rate of the broad monetary aggregate M3 stood at 5.0% in February 2016, unchanged from the previous period, hardly able to affect the common currency.

Later on in the day, the US will release its March Consumer Confidence and the S&P/Case-Shiller Home Price index, but attention will focus on Yellen Speech at the Economic Club of New York, as investors will be looking for a shift in her latest tone, to a more hawkish stance in line with latest FED's speakers.

View the Live chart of the EUR/USD

As for the EUR/USD pair technical picture, the 4 hours chart shows that the price is hovering around a horizontal 20 SMA, while the technical indicators have turned lower around their mid-lines, not enough to confirm a downward move. The recent lows in the 1.1140 region are the immediate support, with a break below it signaling a probable bearish continuation down to 1.1080/1.1100, en route to 1.1045.

Should the pair regain the 1.1200 level, the short term risk then turns towards the upside, with the market then eyeing an advance towards the 1.1250/60 price zone.

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