EUR/USD is trading on a softer note early in the European morning, breaking below the 1.1200 support ahead of the speech by Chairwoman J.Yellen. According to the research team at UOB Group, “Despite the smart rebound from the low of 1.1150/55 yesterday, there are no pre-indications that EUR is about to embark on a sustained up-move. That said, a test of the strong 1.1280 resistance will not be surprising in the next couple of days but at this stage, we do not expect a significant move above this level (a clear break could lead to a quick move towards the next major resistance at 1.1375). Key support is still at 1.1120”. Additionally, Senior Analyst at Danske Bank Jens Pedersen noted “We do, however, maintain that all other factors but relative rates support a higher EUR/USD, which we therefore think will be held range bound in the coming months targeting the cross at 1.12 in 1M and 3M. In our view it will take a combination of a marked re-pricing of the Fed together with heightened ‘Brexit’ fears to send the cross below 1.10 in the near term (not our base case). Medium to long term we still look for the cross to edge gradually higher – primarily on valuation – and we forecast the cross at 1.18 in 12M”. For more information, read our latest forex news.