EUR/USD – Euro edges higher as German GDP matches forecast

EUR/USD has reversed directions in Friday trade and posted slight gains. Currently, the pair is trading at 1.1565, up 0.21% on the day. On the release front, German Final GDP improved to 0.5% in the second quarter, matching the estimate. In the U.S, the markets are expecting mixed results from durable goods reports for July. Core durable goods are forecast to rise to 0.5%, while durable goods are expected to downturn, with an estimate of -0.7%. Investors will be listening closely as Federal Reserve Chair Jerome Powell speaks at the economic symposium at Jackson Hole.

With a dearth of data for the markets to digest the week, the Federal Reserve is in the spotlight. Fed chair Jerome Powell will address the Jackson Hole gathering of central bankers. With the heads of the ECB and Bank of Japan conspicuously absent, Powell’s speech will be the main event of the meeting. With a September rate hike practically a given, investors will be looking for Powell to discuss trade tensions, particularly with China, as well as the lack of wage growth despite a tight labor market. Earlier this week, Powell said that the Federal Reserve would maintain its independence and would not be influenced by President Trump’s criticism of the Fed’s plans to continue raising interest rates.

The Federal Reserve released the minutes of its August meeting on Wednesday. The minutes noted that the U.S economy remains strong and hinted that the Fed would raise rates in September. However, policymakers added that there plan to continue with gradual rate increases could have to be halted if the global trade war worsened, as the trade war represented a major downside risk to the U.S economy. The minutes have cemented a rate hike in September, with an estimate of 98%, while the odds of a December rate hike stand at 57%.

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Friday (August 24)

  • 2:00 German Final GDP. Estimate 0.5%. Actual 0.5%
  • 8:30 US Core Durable Goods Orders. Estimate 0.5%
  • 8:30 US Durable Goods Orders. Estimate -0.7%
  • 9:00 Belgian NBB Business Climate. Estimate -0.5
  • 10:00 Federal Reserve Chair Powell Speaks
  • Day 2 – Jackson Hole Symposium

*All release times are DST

*Key events are in bold

 

EUR/USD for Friday, August 24, 2018

EUR/USD for August 24 at 4:30 DST

Open: 1.1541 High: 1.1580 Low: 1.1535 Close: 1.1566

EUR/USD Technical

S1 S2 S1 R1 R2 R3
1.1312 1.1434 1.1553 1.1637 1.1718 1.1840

EUR/USD edged higher in the Asian session. In the European session, the pair posted small gains but has retracted

  • 1.1553 is fluid. Currently, it is a weak support line
  • 1.1637 is the next resistance line

Further levels in both directions:

  • Below: 1.1553, 1.1434, 1.1312 and 1.1119
  • Above: 1.1637, 1.1718, 1.1840
  • Current range: 1.1553 to 1.1637

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.