EUR/USD Steadies Near 1.1600 Ahead of Powell Speech.
EUR/USD pares back earlier declines as traders turn cautious ahead of Fed Chair Powell’s speech
FUNDAMENTAL OVERVIEW:
The EUR/USD is rebounding slightly from its lows but continues to hover near two-week troughs around 1.1600 ahead of Friday’s U.S. session. The Dollar stays firm as markets await Fed Chair Powell’s Jackson Hole address, expected to shed light on future monetary policy direction.
Earlier, weak Nonfarm Payrolls and a softer CPI report had fueled optimism for a September rate cut, though subsequent data tempered those expectations. Futures now price in a 75% chance of easing, down from over 90% two weeks ago, according to CME’s Fed Watch Tool.
Thursday’s data painted a mixed picture: manufacturing activity rebounded strongly, but elevated jobless claims highlighted lingering weakness in the labor market. This divergence has heightened anticipation for Powell’s stance—whether the Fed will lean toward supporting employment or continue prioritizing inflation risks, especially amid tariff pressures.
Fed officials offered differing views on Thursday. Cleveland Fed President Beth Hammack stressed inflation remains the chief concern, while Boston Fed President Susan Collins voiced greater worries over signs of economic slowdown. This uncertainty has left traders looking to Powell for clearer direction.
EUR/USD TECHNICAL ANALYSIS CHART:
Technical Overview:
EUR/USD is trading within a down channel.
EUR/USD is moving above all the Moving Averages (SMA).
The Relative Strength Index (RSI) is in the Buying Zone, while the Stochastic oscillator suggests a Positive trend.
Immediate Resistance level: 1.1718
Immediate support level: 1.1594
HOW TO TRADE EUR/USD
EUR/USD, after climbing higher, stalled and entered a consolidation phase before sharply reversing to the downside. At present, the pair is holding around a key support zone, showing renewed bullish momentum. If it sustains above this level, further upside movement could be expected.