The euro went into a tailspin ahead of today's Federal Reserve's interest rate decision and Janet Yellen's press conference. While investors see zero chance of a rate hike today, the dollar benefited from safe haven flows, as risks of a potential Brexit increase with only few days to go before the U.K. referendum next week.
The Fed is widely expected to leave monetary policy unchanged this month, but market participants will be looking for hints as to whether or not a July hike is also off the table. The central bank will also release its latest summary of economic projections, but the main focus will be on Yellen's comments at the press conference.
While the majority of market participants are likely to turn the eyes to a Fed hike in September, optimistic comments from the Fed chair might keep a small chance of an increase in July alive.
The FOMC statement is scheduled to be released at 18:00 UTC, followed by a press conference 30 minutes later.
As we cannot predict the market's reaction on incoming data and major risk events, we will focus on the technical picture and potential trading opportunities.
The overall bias is clearly bearish, with the currency pair trading within a recent downward channel, formatting also a head-and-shoulders pattern. The focus now shifts to the crucial support area at 1.1150-1.11 from where the euro may start a relief rally.
However, if the euro remains firmly above 1.1180 we could see an upside correction towards 1.1350 and 1.1380, but this hinges on the decreased demand for USD. On the bottom side we expect the 1.1050 level to lend a short-term support for the euro in case it breaks below 1.11. 
The cable favored the downtrend on heightened Brexit risks. For the time being, the 1.41-level proved to be a short-term support for the pound, and sterling bears should wait for a sustained break below 1.4090 in order to turn their eyes to the next bearish target at 1.40, which is seen as a key support. Once the pound breaks below 1.40, there will be no major support until 1.39/1.3850.
However, given the fact that sterling trades around the lower bound of its recent trading range, we could see some pullbacks now. While bullish breakouts above 1.4230 may result in an upward move towards 1.43 and 1.4340, we advise traders to be careful with any bullish engagement in the run-up to the U.K. vote.
Before the Fed statement, the U.K. labor market report at 8:30 UTC could have a small impact on the pound while U.S. PPI data, scheduled for release at 12:30 UTC, could marginally influence the greenback's performance.
We wish all traders good trades for today.
Here are our daily signal alerts:
EUR/USD
Long at 1.1220 SL 25 TP 30, 100
Short at 1.1185 SL 25 TP 30, 100
GBP/USD
Long at 1.4170 SL 25 TP 35, 100
Short at 1.4085 SL 25 TP 30, 80
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