Categories: Markets

EUR/USD rises to fresh weekly highs, paring modest gains

EUR/USD rises to fresh weekly highs, paring modest gains
  • EUR/USD hits a daily high of 1.0075, after sources report that ECB members are seeking a 75 basis point rate hike.
  • The Fed’s favorite inflation gauge shows it’s slowing.
  • FOMC Chairman Jerome Powell speaks at the Jackson Hole Symposium – live stream

The shared currency regained parity, breaking back above the 1.0020 area on Friday, as the US Fed’s preferred gauge of inflation shows interest rate hikes are still working, weakening the dollar.

EUR/USD hit a daily low during the European session at 0.9946 before the common currency maintained a rally, hitting a daily high at 1.0040, as investors await further hawkish guidance from Fed officials. At the time of writing this report, the EUR/USD It is trading at 1.0065, above its opening price.

Before the open on Wall Street, the US Commerce Department reported that the July personal consumption expenditures (PCE) price index declined 0.1% mom, less than estimates of a 0.3% rise. . Excluding volatile items such as food and energy, so-called core PCE, the Fed’s favorite measure of inflation, rose 0.1% mom, versus 0.3% forecast. In annual terms, headline PCE rose to 6.3% vs. 6.2% forecast, while core PCE slowed to 4.6% from 4.7%.

EUR/USD and DXY reaction to US data

EUR/USD jumped from around 1.0000 to 1.0020 once the headlines came off traders’ screens and has reached the 1.0040 level so far. At the same time, the USD weakened, as shown by the US Dollar Index, which fell from around 108.350 to 107.920, down 0.43% so far.

Meanwhile, Europe’s financial narrative has not changed. The extreme energy crisis plaguing the bloc, coupled with growing recession fears especially in Germany, the region’s largest economy, made euro buyers cautious about opening new long bets against the dollar.

Lately, sources quoted by Reuters reported that some ECB policy makers wanted to discuss a 75 basis point hike for September due to a further deterioration in the inflation outlook. The EUR/USD pair has rallied strongly from around 1.0040 to fresh daily highs around 1.0075 at 13:34 GMT.

5 minute chart

EUR/USD Key Technical Levels


Last Price Today 1.0064
Today’s Daily Change 0.0090
Today’s Daily Change % 0.90
Today’s Daily Opening 0.9974
20 Daily SMA 1,015
50 Daily SMA 1.0237
100 Daily SMA 1,044
200 Daily SMA 1.0834
Previous Daily High 1.0034
Previous Daily Minimum 0.9949
Previous Maximum Weekly 1.0268
Previous Weekly Minimum 1.0032
Monthly Prior Maximum 1.0486
Previous Monthly Minimum 0.9952
Daily Fibonacci 38.2% 1.0001
Daily Fibonacci 61.8% 0.9981
Daily Pivot Point S1 0.9938
Daily Pivot Point S2 0.9901
Daily Pivot Point S3 0.9853
Daily Pivot Point R1 1.0022
Daily Pivot Point R2 1,007
Daily Pivot Point R3 1.0107

Source: Fx Street