Daily Price Outlook

The global market sentiment has prolonged its upward trend and improved on Wednesday as concerns about US-China relations combined with anticipation for the preliminary August Purchasing Managers Indexes (PMIs) for major economies. As in result, the S&P 500 Futures showed a 0.20% intraday increase, recovering from the previous day's decline. Furthermore, the US 10-year Treasury bond yields decreased by two basis points to 4.31%, following a reversal from the previous day's peak, which was the highest since 2007.

Positive Steps in US-China Relations: Commerce Secretary's Meeting and Sanctions Removal

The US Commerce Department mentioned a positive development on Tuesday. Commerce Secretary Gina Raimondo is set to meet with the Chinese Ambassador and Vice Foreign Minister, Xie Feng, next week. They had a productive discussion before Raimondo's trip to China. This week, the US Commerce Department's Bureau of Industry and Security (BIS) took 27 Chinese entities off its Unverified List. This action removed sanctions from those entities and raised hopes for better US-China relations.

The positive development of Commerce Secretary Gina Raimondo's upcoming meeting with Chinese officials, coupled with the removal of 27 Chinese entities from the Unverified List by the BIS, has generated optimism in the market. This suggests potential improvement in US-China relations, boosting investor sentiment and fostering hopes for enhanced economic cooperation.

Market Sentiment and Economic Factors Influencing Trading

On the flip side, the ongoing concerns about China's economic recovery and a stronger US Dollar are tempering market optimism, especially ahead of upcoming data releases. Despite this, the US Dollar Index (DXY) has pulled back from its recent 10-week high of around 103.50. This retreat follows positive reports on US Existing Home Sales in July and the Richmond Fed Manufacturing Index for August, along with higher Treasury bond yields.

The Existing Home Sales showed a 2.2% decrease compared to the previous month's 3.3% drop. The Richmond Fed Manufacturing Index matched the market forecast of -7.0, slightly better than the previous -9.0. Federal Reserve Bank of Richmond President Thomas Barkin emphasized achieving the 2.0% inflation target and downplayed US recession concerns by suggesting any potential recession would likely be less severe.

He also noted the Fed should consider the possibility of the economy picking up pace, affecting the central bank's inflation strategy. This stance is boosting the risk-on sentiment.

Global Economic Updates and Key Events for Traders

Australia and New Zealand had disappointing PMIs and retail sales, while Japan's PMIs improved, boosting the Yen. Traders are watching US PMIs and Existing Home Sales. S&P Global Manufacturing PMI might rise, but Services could dip slightly. The Australian Dollar might be influenced. The Jackson Hole Symposium on Friday is also important for guidance.

S&P500 (SPX) - Technical Analysis

Analyzing the technical landscape of the S&P 500 reveals an interesting scenario. Despite minor fluctuations reminiscent of a drizzle, my attention has been directed towards the 4400 level. A closer examination unveils the 50-day exponential moving average acting as a robust support pillar at 4385.

The noteworthy development is the confirmation triggered by candle closures above this threshold, signaling a bullish inclination. Delving into the technical indicators, both the relative strength index and the moving average convergence divergence indicators exhibit a steady stance, lending weight to the potential for a sustained upward trajectory.

Moreover, a compelling possibility emerges as the S&P 500 demonstrates the capacity to aim for the 4420 level. Should this objective be realized, the subsequent milestone at 4450 looms on the horizon. Conversely, a breach below 4385 could steer the index towards the 4360 or 4336 vicinity. As prudent strategy dictates, maintaining a vigilant stance to seize a buying opportunity around the 4385 level is recommended for the day.

Daily Price Outlook

The GBP/USD currency pair continued a small upward movement from last night but is having difficulty gaining strong momentum. It's trading in a narrow range, staying below the mid-1.2700s level during the Asian session on Wednesday. However, the recent modest upward trend could be attributed to the bearish US dollar. The broad-based US dollar lost some strength as US bond yields decreased, and there's a slightly positive attitude towards riskier assets, which makes the safe-haven dollar less attractive.

Looking ahead, traders are being cautious about making big trades before the release of UK/US PMIs (Purchasing Managers' Index) and the Jackson Hole Symposium.

USD's Performance, Fed's Stance, and Market Caution Ahead of Jackson Hole Symposium

The broad-based US dollar, tracked by the USD Index (DXY) against various currencies, couldn't maintain its gains from Tuesday when it reached its highest level since July 12. This happened even though the US Treasury bond yields decreased slightly. Additionally, a positive outlook for US stock futures weakened the safe-haven appeal of the dollar and supported the GBP/USD pair (British pound against the US dollar).

The Federal Reserve is expected to stick with its plan of keeping interest rates higher for a longer period, which influences the dollar's performance. On top of that, concerns about China's worsening economic situation are also impacting the dollar. These factors combined are preventing the dollar from falling too much and are capping the gains for the GBP/USD pair.

Traders are also being cautious before the important Jackson Hole Symposium, where central banks' statements could bring significant market volatility. Because of this upcoming event, traders are holding back from making strong bets.

British Pound's Resilience and Upcoming Economic Data

Furthermore, the British Pound (GBP) is gaining added strength due to increasing expectations of more interest rate hikes by the Bank of England (BoE). Current market trends indicate a likelihood of over 80% for a 25 basis points increase during the upcoming BoE meeting in September. This growing confidence in rate hikes has been fueled by the recent news that wages in the UK experienced a notable increase in the second quarter, reaching a new record growth rate.

This development has raised concerns about potential long-term inflation, even following a sequence of 14 consecutive rate hikes that brought rates to a 15-year high in August. Besides, the positive UK GDP report and a slightly higher UK Consumer Price Index (CPI) reading further support the potential for the BoE to continue tightening its monetary policy.

Looking ahead, the release of the flash PMI numbers from the UK and the US on Wednesday will be closely observed for chances in short-term trading. These figures offer new perspectives on the overall economic well-being and whether the central banks can consider more interest rate hikes. This has a direct impact on the GBP/USD pair.

GBP/USD - Technical Analysis

The GBP/USD pair exhibited a downward rebound subsequent to reaching the 1.2800 barrier in the preceding sessions. This movement aimed to test the established support level just above 1.2725. It is worth noting that the price is currently consolidating above this level, complemented by distinct positive signals observed in the stochastic indicator.

Consequently, we maintain the view that there are viable opportunities for the anticipated bullish sentiment to resume in the intraday context. This projection targets the 1.2825 level as the subsequent key target. It is important to highlight that a breach of the 1.2725 level would invalidate the positive scenario, potentially prompting a resumption of downward movement.

The anticipated trading range for the day is expected to be confined between the support at 1.2680 and the resistance at 1.2830.

Daily Price Outlook

The USD/JPY currency pair failed to prolong its upward rally and currently trades near 146.37 during the Asian trading hours on Tuesday. The recent foreign investor selling of Japanese Government Bonds (JGBs), could influence the USD/JPY currency pair. The central bank's actions to weaken the yen might push the pair higher.

Furthermore, the concerns about policy adjustments due to changes in Yield Curve Control (YCC) could add uncertainty, impacting the yen's value. As a result, the USD/JPY pair might see fluctuations as market players gauge the central bank's moves and investor sentiment evolves.

Impact of Rising Japanese Bond Yields on USD/JPY Currency Pair

Moreover, the recent improvement in Japan's growth and inflation numbers has led to higher yields on 10-year and 30-year Japanese Government Bonds (JGBs), reaching their highest levels since 2014 at around 0.66% and 1.66% respectively. This increase in bond yields is strengthening the market's belief that the Bank of Japan could be moving away from its very loose monetary policy, especially after adjusting the Yield Curve Control (YCC) policy.

As Japan's bond yields rise, the Yen may gain strength. A stronger Yen could potentially put downward pressure on the USD/JPY currency pair, as the US Dollar might weaken against the resilient Yen.

Factors Influencing USD/JPY Amidst Market Caution and Bond Yield Changes

In the meantime, the positive US data and concerns about the banking sector, along with China's economic recovery efforts falling short, create cautious market sentiment and boost bond yields. The Yen benefits as a safe haven. Also, a labor survey indicating high wage expectations contributes to the risk-off mood and stronger bond yields. These factors combined could weaken the USD/JPY currency pair, as the Yen gains strength amid market uncertainty and firmer bond rates.

Moving on, the upcoming US housing data, Japan's inflation figures, and policymakers' speeches will play a role in USD/JPY trading. Crucially, all eyes are on Fed Chair Jerome Powell's speech at the Jackson Symposium on Friday, which will heavily influence the currency pair's movement.

USD/JPY - Technical analysis

The USD/JPY currency pair experienced an upward surge in the previous trading session, following a breach of the bullish flag's resistance line highlighted in our previous analysis. This propelled the pair towards the awaited positive target at 146.55. It's worth noting that the price's positive momentum has waned as it embarks on the current trading day.

Notably, the stochastic indicator exhibits a negative overlap, thereby bolstering the likelihood of potential downturns in the forthcoming sessions. This outlook anticipates a decline towards the levels of 145.15 and subsequently 144.55, identified as the primary negative waypoints.

Given the prevailing circumstances, a bearish bias is to be anticipated for today's trading session. It's pertinent to acknowledge that a breakthrough above the 146.55 level could trigger a resumption of the primary bullish trend, facilitating further gains with a potential target of 147.00. The projected trading range for the day is foreseen to span between the support level at 145.00 and the resistance level at 146.55.

Daily Price Outlook

The EUR/USD currency pair managed to gain positive momentum for the second consecutive day on Tuesday, climbing back above the 1.0900 mark during the Asian trading session. However, the recent upward movement can be attributed to a statement made by the European Central Bank (ECB) Chief Economist, Philip Lane, on Friday. He mentioned that the Euro Zone economy is expected to continue growing and is unlikely to face a significant or prolonged recession.

Lane's remarks led to a reduction in the inversion of the German yield curve and supported the possibility of the ECB implementing further policy tightening. This, in turn, has provided a strength to the shared currency and contributed to the EUR/USD pair gains. Moreover, the minor weakness in the US Dollar has also contributed to the favorable conditions for the EUR/USD pair.

Factors Influencing the USD and Their Impact on the EUR/USD Pai

The USD Index (DXY) is currently lower than its highest point since July 12. This is because traders are expecting the Federal Reserve to pause its trend of increasing interest rates in September. However, the US economy is still showing strength, leaving room for the possibility of another slight rate increase of 0.25% by the end of this year. This potential rate hike could prevent significant drops in the US Dollar's value.

Investors widely believe that the Fed will maintain relatively high interest rates for a considerable period. This conviction is keeping the yields on US Treasury bonds at elevated levels. Remarkably, the yield on the key 10-year US government bond recently hit a 15-year high.

In the meantime, investors are moving cautiously due to a general feeling of uncertainty. This has led to the US Dollar being seen as a safe-haven currency. Currently, it's staying slightly above an important moving average. This cautious attitude among investors might discourage them from taking overly aggressive actions regarding the EUR/USD pair.

Market Events to Watch and Their Impact on EUR/USD Trading

Investors are cautious ahead of speeches by Fed Chair Jerome Powell and ECB President Christine Lagarde at the Jackson Hole Symposium, along with upcoming preliminary PMI numbers from the Euro Zone and the US, which provide insights into economic performance and potential central bank actions.

Besides this, attention turns to Tuesday's release of Euro Zone Current Account figures and US data on Existing Home Sales and the Richmond Manufacturing Index. These, coupled with US bond yields and overall investor risk sentiment, will influence the short-term trading dynamics of the EUR/USD pair.

EUR/USD - Technical analysis

The EUR/USD currency pair concluded the previous day's trading session above the 1.0880 level, and as the new day commences, it carries forward an additional bullish inclination. This momentum has prompted a test of the EMA50, which forms a minor resistance point at 1.0915. This development indicates a potential for achieving projected gains within the intraday scope, with an initial target set at 1.0955. It's worth noting that surpassing this level could serve as a catalyst for the price to progress toward the next positive station at 1.1030.

Given the current trajectory, a continued bullish bias is anticipated for the present trading session. It is essential to highlight that any breach of the 1.0880 level would potentially curtail the projected upward movement, causing the price to revert to a correctional bearish phase. The projected trading range for the day is expected to fall between the support level at 1.0850 and the resistance level at 1.1000.

Daily Price Outlook

Gold Price (XAU/USD) has dropped to its lowest point in five months, showing a downward trend. Despite a small positive movement yesterday, it's struggling to recover and remains below $1,900. Traders are cautious, holding back from strong bids as they await more information about the Federal Reserve's upcoming policies. All eyes are on the Jackson Hole Symposium later this week, where Fed Chair Jerome Powell's comments will be closely watched for signals about future interest rate changes.

This will significantly affect the short-term movement of Gold prices. At the same time, as more people realize that the Federal Reserve plans to keep interest rates up for a while, the US Dollar (USD) remains pretty steady.

Fed's Interest Rates and Gold Price Dynamics

It is worth noting that the Fed is expected to stop raising interest rates for now, but some people still think there might be one more increase later. This is because inflation in the US is not completely under control. The US economy seems strong, which makes it likely that the Fed might make policies stricter. These actions make US bonds more attractive and the US Dollar stronger, which affects the price of Gold.

This expectation was influenced by the United States (US) Consumer Price Index (CPI) and the Producer Price Index (PPI), which indicated that the effort to bring inflation back to the Fed's desired 2% target is still ongoing.

Gold Price and China's Economic Concerns

However, despite these developments, the Gold price might find some support due to lingering concerns about economic troubles in China. The recent decision by the People’s Bank of China (PBoC) to implement a smaller interest rate adjustment on Monday, even amidst worries about problems in China's real estate sector, indicates that the Chinese government is not providing extensive support for the economy. This situation has led to a decrease in risk appetite among investors.

GOLD (XAU/USD) - Technical analysis

The price of gold has successfully breached the resistance of the bearish channel, establishing itself above this level and setting the stage for a bullish trajectory in the intraday scope. The focus of this bullish movement is directed towards the initial primary target at $1913.15. It's noteworthy that surpassing this level would signify the continuation of the upward trend, leading to further gains and potentially reaching the levels of $1929.00 and subsequently $1945.20.

Consequently, the prevailing sentiment points towards a bullish trend for today's trading session. A breach of the support level at $1897.00 would facilitate the accomplishment of the aforementioned targets, while breaking below $1889.35 would introduce a negative aspect, prompting the price to revert to a bearish course once again. The projected trading range for today is anticipated to fall between the support level at $1885.00 and the resistance level at $1913.15.

Daily Price Outlook

Gold (XAU/USD) price has been on a decline lately, hitting its lowest point in five months. However, the reason behind this dip is that many investors are turning to the US Dollar as a safe haven due to uncertainties surrounding important events and data scheduled for this week. Adding to the downward pressure on the XAU/USD is the negative sentiment surrounding China, a major consumer of commodities. Despite this recent decline, it's worth noting that the gold price is still holding above its key support level of $1,700 per ounce.

This could indicate that the sellers might be losing their grip, potentially setting the stage for a rebound in the near future. The upcoming economic data and events from the US could play a significant role in steering the direction of the gold price.

China's Economic Woes Weigh on Gold Prices

China holds a significant position as one of the globe's largest users of commodities, which means that any concerns about its economy can send waves through various markets, including impacting the price of gold. In recent months, China has faced a series of hurdles such as a slowdown in economic expansion, trade tensions with the US, and a challenging property situation. These issues have cast a shadow over investor confidence and have contributed to the dip in gold prices.

According to the latest news, the People's Bank of China (PBoC) recently made a significant move. On Monday, they decided to lower the one-year Loan Prime Rate (LPR) by 10 basis points, bringing it down from the previous 3.55% to a new rate of 3.45%. Simultaneously, they opted to maintain the five-year LPR at a steady level of 4.2%. This decision comes in the midst of ongoing challenges within China's property sector, sluggish consumer spending, and a noticeable decline in credit growth. Consequently, China's economic recovery has hit a bit of a stumbling block.

The PBoC's decision to lower the one-year Loan Prime Rate reflects concerns about China's economic challenges. As these difficulties persist, the move might alleviate pressure on gold prices by signaling potential government intervention to stimulate the economy, thereby influencing market sentiment and curbing potential declines.

US Dollar Strength Underscores Gold's Weakness

The US dollar is often considered a safe-haven choice, and when it gains strength, it tends to put pressure on gold prices. This is because gold is viewed as riskier compared to the dollar. Lately, the US dollar has been on the rise, influenced by factors like the Federal Reserve's cautious approach and the ongoing US-China trade tensions.

Federal Open Market Committee (FOMC) meeting showed that inflation is still too high, and officials are really worried about it. They said they might need to raise rates more to get inflation under control and will decide based on new information. This week, everyone's looking forward to Federal Reserve (Fed) Chairman Jerome Powell's talk at the Jackson Hole Symposium.

Apart from this, market watchers will focus on S&P Global Purchasing Managers' Indexes (PMI) figures and central bankers' statements for insights.

GOLD (XAU/USD) - Technical analysis

The gold price has exhibited initial positive movement from today's opening, positioning itself for an anticipated examination of the resistance within the bearish channel. This trajectory is influenced by the current positive momentum of the stochastic indicator, suggesting a potential resumption of the bearish trend, with its next focal point projected around the $1873.50 mark.

The prevailing negative influence originating from the EMA50 reinforces the projected bearish wave. It's worth noting that, should the price manage to surpass the $1895.00 threshold, this could trigger additional upward momentum, potentially leading to a test of the noteworthy resistance at $1913.15, prior to any subsequent attempts at decline. The anticipated trading range for the day spans between the support at $1873.50 and the resistance at $1900.00.

In terms of the expected trend for today, a bearish sentiment is anticipated to persist.

Daily Price Outlook

The AUD/USD currency pair was unable to stop its losing streak and remained depressed around below 0.6400 mark. However, this decline can be attributed to the recent smaller rate cut by the People’s Bank of China (PBoC), indicating limited support for the economy despite worries about the property market crisis. This uncertainty has left investors hesitant, leading to a decline in the riskier Australian Dollar. In the meantime, the weakening sentiment has also impacted markets, putting additional pressure on the AUD. Furthermore, the stronger US Dollar, supported by the potential for a Fed interest rate hike, was also contributing to the downward pressure on the AUD/USD pair.

US Dollar Strength and Factors Affecting AUD/USD Pair

The broad-based US dollar, tracked by the USD Index (DXY), is staying just below its highest level in over two months due to the Federal Reserve's likely plans to raise interest rates. However, the recent minutes from the July meeting of the Federal Open Market Committee (FOMC) show they're focused on controlling inflation. Furthermore, the US economy is doing well, according to recent data, supporting the idea that the Fed might tighten policy more.

At the same time, the expectation that the US central bank will keep rates higher for a while is keeping US Treasury bond yields up and helping the US dollar. This suggests the AUD/USD pair will likely continue to fall. However, traders who are expecting a drop might not make big bets before the Jackson Hole Symposium this week. Central bankers' comments there could cause a lot of ups and downs in the markets.

AUD/USD - Technical analysis

The AUD/USD pair maintains its fluctuation around the 0.6400 level, encountering challenges in achieving a decisive breakthrough. It is worth noting that the stochastic indicator is once again indicating a loss of positive momentum.

This development is anticipated to contribute to propelling the price towards a successful breach of this level, subsequently extending the decline on both the intraday and short-term scales. It is important to highlight that our next identified target stands at 0.6310.

Consequently, our outlook continues to lean towards a bearish trajectory for the forthcoming period, provided the price remains stable below the 0.6440 threshold. The projected trading range for the day spans between the support at 0.6350 and the resistance at 0.6450.

In terms of the anticipated trend for today, a bearish sentiment prevails.

Daily Price Outlook

The EUR/USD currency pair starts the week with a slight rise, hovering around 1.0880, indicating that the Euro is gaining a little strength against the US Dollar. Although, traders and investors are seems cautious to place any strong bid as they are anticipating the release of the German Producer Price Index (PPI). This PPI data is important because it provides insights into economic trends.

Investors are excited and anxious to see how the PPI results will impact the EUR/USD currency pair, as it could push the pair's movement in different directions, prompting market participants to closely watch on the outcome.

Eurozone Economic Indicators and Central Bank Dynamics

According to the latest reports, the Eurozone's economy grew by 0.3% in the second quarter of this year, which was in line with expectations. On a yearly basis, the growth was 0.6%. Meanwhile, the good news also came from the manufacturing sector, as industrial production increased by 0.5% in June, beating predictions. This helps ease concerns about rising prices, as July's inflation rate was 5.3%, a bit lower than before.

Hence, the Eurozone's positive economic indicators, including GDP and industrial production, along with lower inflation, could weaken the Euro against the US Dollar due to reduced pressure on the European Central Bank to raise interest rates. This potential interest rate difference may impact the EUR/USD pair, making the Euro less attractive compared to the dollar.

Focus on Federal Reserve's Actions and Market Response

Across the ocean, market sentiment is experiencing shifts influenced by the Federal Reserve and its monetary policy. Despite a mix of robust labor data and softer inflation figures, investors are increasingly betting on the possibility of additional rate hikes. However, the upcoming speech by Federal Reserve Chairman Jerome Powell holds the potential to be a game-changer for market sentiment.

As traders look to the future, the spotlight turns to the Fed's policy trajectory. Powell's speech is expected to provide crucial insights into the Fed's stance on the economy, inflation, and the potential need for further interest rate adjustments. This event has the power to significantly impact market volatility and steer the direction of the EUR/USD pair.

EUR/USD - Technical analysis

The EUR/USD pair is exhibiting fluctuations near the 1.0880 level, while also making attempts to consolidate below it. Notably, the stochastic indicator is experiencing a decline in its positive momentum, approaching the overbought zones. Meanwhile, the EMA50 is exerting downward pressure on the price.

As a result, we hold the view that the likelihood of a resumption in the anticipated bearish trend remains valid for the upcoming period. The subsequent significant target lies at 1.0785. It's worth considering that a breach of the 1.0880 level could initiate recovery efforts, aiming for testing the 1.0955 mark before a clear trend direction becomes evident.

The trading range expected for today spans between the support at 1.0790 and the resistance at 1.0950.

Daily Price Outlook

The GBP/USD currency pair stopped its three-day winning trend and is currently around 1.2720 on Friday. This is happening because retail sales data from the UK, showing weaker numbers, has pushed the pair down. Furthermore, there is a caution sentiment due to increased risk aversion, strong US Treasury yields, and ongoing economic issues in China, all of which are putting pressure on GBP/USD.

These factors might make the US Dollar stronger and could affect the direction of the pair. Traders might be more careful after UK inflation numbers, which were released on Wednesday. These numbers have already boosted the pair, and there's worry they might lead the Bank of England (BoE) to consider raising interest rates in their September meeting.

UK Retail Sales Drop More Than Expected, Pressuring GBP/USD

According to the latest data from the Office for National Statistics (ONS), UK Retail Sales took a 1.2% tumble in July compared to the expected decrease of 0.5%. This decline follows a 0.6% growth in the previous month. The Core Retail Sales, which excludes car fuel sales, also saw a drop of 1.4% in July, worse than the anticipated decrease of 0.7%.

On a yearly basis, Retail Sales went down by 3.2% in July, more than the expected 2.1% decrease, while Core Retail Sales fell 3.4%, surpassing the expected 2.2% drop. These disappointing numbers have pushed GBP/USD to test daily lows around 1.2725, trading at 1.2727 with a 0.09% decline for the day.

US Dollar Pulls Back Despite Positive Data; Market Cautious About Inflation Clues

The broad-based US dollar is giving back some of its recent gains. The DXY, which tracks the dollar against major currencies, is hovering around 103.40. However, this retreat comes despite better US data, creating caution in the market as it looks for more clues about inflation. For instance, Initial Jobless Claims for the week ending on August 11 decreased to 239K from the previous 250K, slightly beating the expected 240K. Meanwhile, the Philadelphia Fed Manufacturing Survey for August showed improvement, rising to 12 from the earlier -13.5, higher than the anticipated -10.

Key Data Releases and Jackson Hole Symposium Await in the Upcoming Week

Looking forward to the next week, investors will keep an eye on important data releases in the US and the UK. In the US, Home Sales figures and early S&P Global PMI surveys for August will be in focus. Similarly, the UK will release its PMI survey and GfK Consumer Confidence data for August. These numbers will give us a clearer picture of how both economies are doing and could influence decisions about trading the GBP/USD pair.

GBP/USD - Technical analysis

The GBP/USD pair has successfully breached the resistance line of the bearish channel and established itself above it, signaling an attempt to achieve intraday gains. However, it's noteworthy that the stochastic indicator has shifted from positive momentum to a negative overlap, indicating the potential for a resumption of the corrective bearish trend. This trend is directed towards the 1.2625 region as the next key target.

As a result, it is anticipated that the upcoming trading sessions may witness downward movement. To facilitate progress towards the aforementioned target, a breakthrough of the 1.2725 level is crucial. Conversely, surpassing the 1.2825 threshold would halt the negative projection and prompt a reversal towards higher levels.

The projected trading range for today is expected to be positioned between the support at 1.2660 and the resistance at 1.2825.

Daily Price Outlook

The EUR/USD currency pair managed to halt its recent losses and started gaining momentum, hovering above the range of 1.0885 to 1.0890. It rose by 0.15% over the course of the day. However, the reason for its upward rally could be attributed to the slight decrease in the value of the US dollar. The broad-based US dollar is losing traction and remains sluggish for the second successive day in the wake of retreating US Treasury bond yields and cautious stance ahead of the upcoming Jackson Hole Symposium. This turned out to be a key factor lending some support to the EUR/USD pair.

In contrast to this, the Federal Reserve's more hawkish stance on interest rates might prevent a significant decline in the USD and limit the gains for the EUR/USD pair. Looking forward, traders are focusing on a speech scheduled by the European Central Bank's (ECB) Lane, as well as the final Euro Zone Consumer Price Index (CPI) figures. These events are expected to provide additional momentum and direction for the currency pair.

US Dollar Trends, Fed Expectations, and Economic Conditions

The broad-based US Dollar has been under pressure for two consecutive days due to lower US Treasury bond returns. This has given some support to the EUR/USD pair, indicating the Euro's relative improvement against the Dollar. However, there's a growing belief that the US Federal Reserve will maintain higher interest rates for an extended period.

This sentiment had driven the yield on the primary 10-year US government bond to its highest point in ten months on Thursday. Although US consumer prices saw a moderate rise in July, the struggle to achieve the Fed's 2% target and concerns about global economic conditions persist.

Market Focus and Expectations for EUR/USD

Furthermore, there is talk that the European Central Bank (ECB) could pause its streak of raising interest rates nine times in a row by September. This could prevent the EUR/USD pair from rising much more. So, it's wise to wait for clear signs of strong buying before thinking the recent drop over the last month is over and expecting more gains.

Meanwhile, the final Euro Zone CPI numbers and Lane's speech could change how the Euro does against the Dollar. On the other side, there's no important economic info coming from the US on Friday, so the Dollar will be affected by how US bond yields change.

EUR/USD - Technical analysis

The EUR/USD pair is currently hovering around the 1.0880 mark, and its recent closure beneath this level sustains the bearish outlook for the foreseeable future. The subsequent target is set at 1.0785.

The influence of the EMA50 remains bearish, exerting downward pressure on the price and reinforcing the projected downtrend. This assessment is further supported by the presence of a double top pattern on the chart. It's noteworthy that a solid consolidation above 1.0880 would negate the negative scenario and potentially initiate a recovery phase, with an initial target at the 1.0955 level.

For the current day, the expected trading range spans between the support at 1.0790 and the resistance at 1.0950.