EUR/USD clocked a high of 1.1224 on broad based USD selling, before trimming gains to trade around 1.12 handle. The fall back from the daily high of 1.1224 also marked a failure to sustain above the hourly 200-MA of 1.1216 ahead of Fed’s Yellen speech. Yellen to defend view of two rate hikes in 2016 Markets expect Janet Yellen to sound cautiously hawkish and defend the majority view of two rate hikes in 2016. Her colleagues at the Fed have been all over the wires since last week talking up April/June rate hike bets. The Fed policy statement released two week ago showed majority of the Fed officials forsee two rate hikes this year. Markets were caught off guard and considered the possibility of a single rate hike or no rate hike in 2016. Consequently, dollar took a beating. However, policymakers made a hawkish comeback last week, thus April/June rate hike bets rose. The consensus now in the market is that Fed is preparing ground for a June rate hike and shall point at the same via April policy meeting. Consequently, there exists a possibility of a hawkish surprise today, in which case the EUR/USD pair could breach the recent strong support zone around 1.1150. On the other hand, the pair could take out hurdle at 1.1256 if Yellen downplays possibility of two rate hikes this year. EUR/USD Technical Levels The immediate hurdle is noted at 1.1224 (daily high) – 1.1236 (38.2% of 1.0463-1.1714), above which a major resistance is noted at 1.1257 (61.8% of 1.1714-1.0517). Acceptance above the same would put short-term sell side arguments to rest, thus leading to unwinding of shorts and quick spike to 1.13 levels. Conversely, a break below 1.1173 (23.6% of 1.0517-1.1376) would be needed to push the pair down to 1.1150, under which support at 1.1115 (50% of 1.1714-1.0517) stands exposed. If taken out, the pair might extend losses to 200-DMA level of 1.1041. For more information, read our latest forex news.