EUR/USD Outlook: Directionless mode extends into fifth day as market await fresh signals from Powell
The Euro tested both boundaries of five-day range (1.1066/1.1113) on Thursday, but failed to break on either side, as price action in Asia/Europe/early US session is presented in long-legged Doji daily candle that signal strong indecision.
Conflicting daily indicators (momentum heads south while stochastic is rising) add to neutral near-term tone.
All eyes are on Jackson Hole symposium and speech of Fed Chairman Jerome Powell, who is expected to give more details about monetary policy in coming months.
Strong expectations about aggressive cuts were cooled down by less hawkish than expected Fed minutes on Wednesday and today's comments of Kansas City President George, who supports idea of keeping rates at current levels until signs that the US economy is changing direction.
On the other side, expectations for extending rate cuts at stronger pace in coming months, exist among traders.
Scenario of softer tone from Fed would boost dollar and risk Euro's final attack at psychological 1.10 support.
Conversely, the single currency may regain traction and accelerate higher if Powell signals further policy easing.
Res: 1.1113; 1.1128; 1.1137; 1.1162
Sup: 1.1063; 1.1042; 1.1027; 1.1000
Interested in EURUSD technicals? Check out the key levels
Author
Slobodan Drvenica
Windsor Brokers
Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.
