The Euro was trading with low volatility during the first part of Wednesday. Higher volatility was introduced later in the evening when the FOMC released its meeting minutes.
The Fed praised the strength of economic growth, while expressing concerns over missed inflation targets. This statement resulted in an immediate upward pressure on the pair, which was soon overrun by the stronger Greenback. As a result, the session ended with a 56 pip decline in price.
Given that the prevailing senior channel was breach mid-session, traders might see a decline in the medium term. However, in terms of the following session, the Euro is expected to bounce off the junior channel and the weekly S1 at 1.2240 to begin a brief period of recovery. Upside target for today—the 1.2350/1.2400 area.
