The EUR/USD was pushing above the 1.26 handle and last week's high near 1.2615 ahead of Bernanke's statement. After recent economic data and Yellen's statement yesterday, the market has been pricing in QE, but did not get it. This can be in the short-term at least a boost for the USD.

There was a point at the QA session where Kevin Brady urges Bernanke to just look the markets in the eye and take QE off the table, sort of calling him out for his unclear communication of monetary policy prospects going forward. But I think the FOMC will keep that in their cards, but it does sound like politicians are some what against it.

EUR/USD 15min Chart 10:41AM EDT 6/7/2012

EUR/USD

The immediate reaction in EUR/USD was a retreat from the 1.2620 area. The 1.2540 level will be a key pivot. Below that we have a rising trendline near 1.25. A break below 1.25 will suggest a completion of a consolidation pattern, which could be seen as a flag, or in Elliott Wave terms - an ABC correction.

EUR/USD 4H Chart 10:45PM EDT 6/7/2012

EUR/USD

The break below can open up June's low in the 1.2285-1.23 area.

Failure to break below 1.2540, and a push back above the pre-Bernanke high at 1.2620 opens up the 1.2820 level. This is the 200-SMA in the 4H chart and also a resistance pivot from May 22.

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Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist of FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources.

Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.