EUR/USD Mid-Session Technical Analysis for August 24, 2017

The EUR/USD is trading lower shortly before the U.S. opening. The range is tight and volume remains thin as investors await Friday’s key speeches at the Jackson Hole central bankers’ symposium by European Central Bank President Mario Draghi and Fed Chair Janet Yellen.

Draghi is expected to be downbeat and is not expected to talk about monetary policy, tapering or the direction of interest rates. He is going to try to steer clear of any comments that could move the Euro higher.

Yellen is also not expected to talk about a potential interest rate hike later this year. She feels that everything that needs to be known has been revealed in the latest Fed minutes and in subsequent speeches by FOMC members. If she does talk about monetary policy, the topic will be the Fed’s plan to begin trimming its massive balance sheet. She’ll probably say the process will begin after the Fed meeting in September. Yellen may also offer some new details about the process.

In the U.S. on Thursday, investors will get the opportunity to react to the latest data on Weekly Unemployment Claims, Existing Home Sales and Mortgage Delinquencies.

Technical Analysis

The main trend is down according to the daily swing chart, however, momentum is trending higher.

A trade through 1.1847 will change the main trend to up. This could lead to a test of the main top at 1.1910. A move through 1.1661 will signal a resumption of the downtrend.

If 1.1661 fails as support then look for the selling to extend into the major retracement zone at 1.1611 to 1.1540.

The intermediate range is 1.1910 to 1.1661. Its retracement zone has been providing resistance at 1.1786 to 1.1815.

The short-term range is 1.1661 to 1.1828. Its retracement zone has been providing support at 1.1745 to 1.1725.

Forecast

Based on the current price at 1.1788 and the earlier price action, look for an upside bias to develop on a sustained move over 1.1815 and for a downside bias to develop on a sustained move under 1.1786.

Keep in mind that buying strength and selling weakness will be difficult if the volume remains below average.

A sustained move over 1.1815 could lead to a test of this week’s high at 1.1828 and the main top at 1.1847.

A sustained move under 1.1786 could trigger an acceleration to the downside if selling volume increases on the move. The main target is the short-term retracement zone at 1.1745 to 1.1725.