EUR/USD Remains Depressed Near 1.1060, Powell Eyed

• EUR/USD navigates near weekly lows around the 1.1060 region.
• The Greenback stays bid and weighs on the pair.
• Fed’s Powell speaks at Jackson Hole later in the day.

The sentiment around the European currency remains bearish although EUR/USD has so far managed well to hold on above the 1.1060 area.

EUR/USD focused on Powell, trade

Spot is in a negative 3-day streak so far on Friday and navigating the lower bound of the weekly range near 1.1060.

The continuation of the buying pressure in the Greenback is seen limiting any bullish attempts in the pair, while investors are reluctant to build long positions in the currency in light of the most likely announcement of extra stimulus measures at the next ECB event in September.

Nothing scheduled today in Euroland in the data space, while all the attention will be on the speech by Fed’s J.Powell at the Jackson Hole Symposium, where the centre of the debate should be on the Fed’s plans regarding further easing and the outlook of the economy.

What to look for around EUR

EUR has finally succumbed to the downside pressure although another test of YTD lows in the proximity of 1.1020 remains elusive for the time being. Renewed buying interest surrounding the buck, expectations of ECB easing and Italian politics are seen driving the mood around the shared currency at the moment. That said, sustained bullish attempts in the pair still look flimsy amidst ECB’s preparations for a fresh wave of monetary stimulus (most likely to be announced in September), including a potential reduction of interest rates, the re-start of the QE programme and a probable tiered deposit rate system. This scenario has been confirmed as of late following poor results from the euro-docket, adding to the unremitting deterioration of the economic outlook in the region.

EUR/USD levels to watch

At the moment, the pair is retreating 0.11% at 1.1066 and faces the next support at 1.1060 (low Aug.23) seconded by 1.1026 (2019 low Aug.1) and finally 1.0839 (monthly low May 11 2017). On the other hand, a breakout of 1.1132 (21-day SMA) would target 1.1213 (55-day SMA) en route to 1.1282 (high Jul.19).

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