• EUR/USD pulls back below 1.1700, but remains trading within previous ranges.
• The Fed is expected to leave interest rates on hold in what is likely to be Powell's last meeting as Chair.
• Risk appetite remains subdued amid the stalled US-Iran peace process.

The Euro (EUR) is trading lower against the US Dollar (USD) for the second consecutive day on Wednesday, retreating below 1.1700 at the time of writing, from 1.1720 highs during the Asian session, yet moving within previous days' ranges. The US Dollar is drawing some support from cautious markets with investors positioning ahead of the US Federal Reserve’s (Fed) decision, and with hopes of a negotiated end to the Iran war fading.

The Fed’s monetary policy decision will be the highlight of the day. Futures markets are fully pricing steady interest rates, according to the CME Fed Watch tool, and a nearly 80% chance that they remain at the current level in December's meeting.

The market, however, will be particularly attentive to Fed Chairman Powell’s press conference, as it is likely to be his last one. His term ends on May 15, and former Governor Kevin Warsh is expected to replace him at the next meeting. The question is whether Powell will remain in his place at the Board of Governors or will exit the bank for good as US President Donald Trump demanded.

Powell has previously affirmed that he would only remain as governor if he sees risks to the central bank’s independence.

Before that, in Europe, Eurozone Economic Sentiment Indicator and the preliminary German Harmonized Index of Consumer Prices (HICP) will provide some data to chew on for traders, and frame the European Central Bank’s (ECB) monetary policy decision due on Thursday.

On the geopolitical front, things remain at a standstill after Trump disliked the peace plan sent by Tehran on Monday. The US president wants to settle the nuclear issue before sealing an agreement. Meanwhile, the Strait of Hormuz is about to end its second month of closure, and The Wall Street Journal reported on Tuesday that Trump told aides to prepare for an extended blockade of Iranian ports.

Technical Analysis: Looking for direction around 1.1700

EUR/USD keeps moving back and forth in a roughly 75-pip range around 1.1700, with investors wary of taking excessive risks. Technical indicators show a neutral-to-bearish bias, although the support area below 1.1675 is providing solid cushion so far.

The 4-hour chart hints at a soft momentum, with the Relative Strength Index (RSI) hovering below the 50 line and the Moving Average Convergence Divergence (MACD) fluctuating around the zero line with slightly negative readings.

Bulls should break session highs at 1.1720 and the April 22 and 27 highs in the 1.1750-1.1760 area to ease bearish pressure and retest the broken trendline, now at 1.1780.

Bears, on the other hand, need additional impulse to extend the downtrend from mid-April highs through a cluster of support levels between 1.1675 and 1.1650, where the pair was contained several times in early April. Below here, the next target is the April bottom between 1.1505 and 1.1525.

(The technical analysis of this story was written with the help of an AI tool.)