With the start of the Jackson Hole seminar, organized by the US Central Bank, the price of EUR/USD, tries to halt its recent losses. This affected the support level 1.0802, and settles around 1.0875 at the time of writing. The statements of US Federal Reserve Governor Jerome Powell, along with the statements of European Central Bank Governor Lagarde during that symposium, will shape the future performance of the euro/dollar currency pair in the coming days.
Top Forex Brokers
In the meantime, weaker than expected economic data may be beneficial to the financial markets. This is because a series of surprisingly strong reports recently have raised expectations that the Federal Reserve will keep US interest rates higher for longer. The Fed has already raised its key interest rate to the highest level since 2001 in hopes of bringing down soaring inflation.
High interest rates work by slowing the entire economy and hurting investment prices and have helped keep inflation down since it peaked above 9% last summer. But the still-strong labor market and household spending threaten to make it difficult for inflation to fall even the last percentage point below the Fed's 2% target.
This is why the key event of the week for the markets could be Fed Chair Jerome Powell's speech on Friday. He will speak at the Jackson Hole, Wyoming event, which has served as the setting for major policy announcements by the Federal Reserve in the past. The hope among traders was that the Fed had indeed raised interest rates for the last time this cycle and that they would start cutting rates early next year. But those hopes are dwindling with each recent stronger-than-expected economic report.
Euro predictions against the dollar today:
- The general trend of the EUR/USD currency pair is still bearish.
- The approach to psychological support 1.0800 confirms the bears' control over the trend.
- From the level and below, the technical indicators are moving towards strong oversold levels.
I prefer to think about buying the currency pair without risk from the support levels 1.0755 and 1.0680, respectively. It may be reached if the US Federal Reserve governor's statements support more US rate hikes. On the other hand, there will be no real shift in the direction to the upside, without returning to the vicinity of the psychological resistance 1.1000 again. Today, the EUR/USD currency pair will interact with the announcement of the US jobless claims number, as well as the durable goods orders.
Ready to trade our daily Forex analysis? We’ve made a list of the best online forex trading platform worth trading with.
