EUR/USD Forecast – Euro Waits for Jackson Hole

EUR/USD Forecast Video for 25.08.23

Euro vs US Dollar Technical Analysis

The euro has been relatively quiet, albeit slightly negative during early trading on Thursday, as we wait for the Jackson Hole Symposium speeches on Friday. After all, we have Jerome Powell out of the Federal Reserve speaking, right along with Christine Lagarde from the European Central Bank. In other words, this currency pair will more likely than not end up being “Ground Zero” for currency traders.

Keep in mind that Thursday has seen the pair test the 200-Day EMA, and then bounce significantly to form a bit of a hammer. By doing so, the market looks as if it is going to try to stabilize in this general vicinity, and it’s also worth noting that the 200-Day EMA touched a major trend line, so there were a lot of reasons to believe the technical traders would have been interested. With that in mind, it’s not a huge surprise to see that today is more about consolidating those short-term gains.

Ultimately, this is a market that I think is trying to break out to the upside again, but we have the 50-Day EMA above that will offer a bit of resistance. A lot of this will come down to the idea of whether or not the market has a “better attitude” in general. That being said, if Jerome Powell spoofs the market, and we break down below the bottom of the hammer from the Thursday session and of course the 200-Day EMA, then it’s possible that the market could drop down to the 1.0650 level.

Typically, when you are watching a market bounce around between the 50-Day EMA in the 200-Day EMA indicators, it means that the market is compressing in general, and it’s possible that we could see an explosive move in one direction or another. That does make a certain amount of sense, due to the fact that the market has seen so much in the way of hesitation and a lack of volume. Once we get through Jackson Hole, it’s possible that could be the catalyst to get moving for a bigger move. Until then, it’s very unlikely that we see a lot going on.

For a look at all of today’s economic events, check out our economic calendar.