EUR/USD: Range-play to continue ahead of ECB’s Draghi at Jackson Hole

The bears continue to guard the key upside barrier near 1.1830 region, leaving EUR/USD confined within almost 80-pips tight range so far this week, as investors await ECB President Draghi’s speech at the Jackson Hole Symposium for the next direction.

ECB policymakers appear to shrug-off the recent EUR appreciation and hence, markets remain optimistic that the central bank Chief Draghi could hint towards QE tapering plans announcement during his Jackson Hole speech.

Thus, markets prefer to hold the common currency against its American counterpart, as they monetary policy divergence narrowing, while yesterday’s remarks from Draghi on the monetary policy combined with stronger Euro area manufacturing PMIs also help keep the sentiment around the Euro underpinned.

Attention now shifts towards the US macro releases, including the jobless claims and existing home sales, for fresh incentives on the US dollar ahead of the much-awaited Jackson Hole event.

EUR/USD Technical Set-up  

"EUR remains bound within the gently descending trend channel off the August 2nd high, with a clear sequence of lower highs and lower lows. We look to near-term resistance above 1.1820 and note the absence of material support ahead of 1.17. Daily signals are neutral-bearish and trendless," noted the Scotiabank analysts.