EUR/USD holds above key Fibonacci and moving-average supports just below a three-and-a-half-month high, with the bullish bias intact heading into today's US PCE inflation release. Traders are also watching Friday's Jackson Hole speech from Fed Chief Warsh for signals on the policy path ahead.
EUR/USD remains in extended consolidation under a fresh three-and-a-half-month high of 1.1711, with price action holding above a broken Fibonacci barrier at 1.1648. That level marks the 61.8% retracement of the 1.1849/1.1324 decline, and the pair staying above it keeps the bullish bias in place.
Momentum stays positive despite warning signs
Daily studies still show strong positive momentum, with multiple moving-average bull-crosses and a converging 10/200-day moving average on track to form a golden cross, underpinning the broader move higher. That momentum comes despite initial negative signals from long upper shadows on Thursday and Friday's daily candles, which had hinted at fading upside pressure.
For the advance to stay healthy, dips should hold above the Fibonacci support at 1.1648 and should not exceed the 200-day moving average at 1.1627. Holding those levels would mark a healthy correction before larger bulls regain full control for a fresh push higher, targeting 1.1725 — the 76.4% Fibonacci retracement — and the 1.1800 zone, which marked the early-May lower platform.
US inflation data and Jackson Hole in focus
The release of the US July PCE Index, closely monitored by the Fed, is the key event today, alongside Friday's speech by Fed Chief Warsh at the Jackson Hole Symposium. Both are expected to provide more detail on the Fed's policy trajectory in the near term.
The single currency would benefit from softer inflation numbers and a dovish stance from the central bank, while higher-than-expected July figures would give the US dollar a fresh boost.
Source: ActionForex
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