The Euro moved lower in late Asian / early European hours, trading around the mid-point of 1.1662/1.1790 range, where the price was entrenched for the most of the last week’s trading.
Daily studies show mixed signals, with 10/20SMA bear-cross (1.1765) weighing on near-term action, while the downside is supported by rising 30SMA (currently at 1.1685).
Break of either hurdle is needed for initial direction signal.
Markets are eyeing key event this week, Fed’s annual central banking conference in Jackson Hole, which starts on Thursday.
ECB chief Draghi is due to speak on Thursday and Fed Chair Yellen on Friday and traders will be looking for fresh signals from their speeches.
However, Yellen would likely not provide any new guidance in policy after last week’s FOMC minutes showed strong concerns about stubbornly low inflation.
Expectation s that Draghi is going to provide more information about ECB’s stimulus tapering are also low.
Traders are positioning ahead of Jackson Hole symposium and further reducing of long positions ahead of event is seen as likely scenario.
Violation of 30SMA and last week’s congestion lows at 1.1680/60 zone could trigger further easing towards next support at 1.1607 (Fibo 38.2% of 1.1118/1.1910 rally)
With no economic indicators from the Eurozone on Monday, trading should stay in a quiet mode.
Res: 1.1754, 1.1774, 1.1790, 1.1846
Sup: 1.1723, 1.1708, 1.1685, 1.1662
