EUR/USD Holds Steady at 1.14 Resistance Ahead of FOMC Decision

### Fundamental Overview

**USD:** The US dollar has been mostly rangebound in recent days, influenced by hedging activities ahead of the FOMC decision and renewed tensions on the US-Iran front. Iran's recent military actions against US forces, although intercepted, have raised concerns about escalating conflicts and potential impacts on energy prices.

Today, the focus shifts to the FOMC meeting, where the Fed is anticipated to keep interest rates steady at 3.50%–3.75%. Market consensus suggests that there may be up to two dissenters advocating for a rate hike, likely from Fed officials Logan and Hammack. The Summary of Economic Projections (SEP) will not be released at this meeting, and forward guidance is expected to remain limited. Fed Chair Warsh is likely to emphasize data dependence and the Fed's commitment to price stability.

A hawkish surprise, such as more dissenters voting for a rate hike, could lead to a rally in the US dollar, while a dovish outcome could result in a short-term decline in the currency.

**EUR:** On the euro side, the European Central Bank (ECB) recently kept interest rates unchanged but indicated readiness to raise rates in September if inflation expectations worsen. Policymakers have highlighted the importance of data dependence and have refrained from committing to future policy moves. The upcoming Flash Eurozone CPI report is expected to influence market expectations for interest rates, with a 65% chance of a rate hike priced in for September.

### Technical Analysis

**Daily Timeframe:** The EUR/USD pair is currently trading below the significant 1.14 resistance level, coinciding with a major downward trendline. This area is expected to attract selling interest, with targets around the 1.10 level. A breakout above this trendline would signal potential for a rally towards 1.16.

**4-Hour Timeframe:** The consolidation around the resistance level is evident, with sellers expected to remain active. Buyers will be looking for a break above the trendline to initiate a potential upward movement.

**1-Hour Timeframe:** The near-term direction remains contingent on the FOMC decision. A hawkish surprise could trigger a selloff, while a dovish outcome may lead to an upside breakout, potentially reaching the 1.1482 level.

### Upcoming Catalysts

Today’s FOMC rate decision will be pivotal. Following that, key economic releases include the Eurozone Flash Q2 GDP, US PCE price index, and Jobless Claims figures. The week will conclude with the Eurozone Flash CPI and the US Q2 Employment Cost Index. Additionally, ongoing developments regarding US-Iran relations will be closely monitored by traders.