EUR/USD Consolidation Continues Ahead of US Inflation Data
The EUR/USD has been consolidating above key supports, maintaining its bullish bias despite some initial negative signals. The currency pair remains above a broken Fibonacci barrier at 1.1648 (61.8% of 1.1849/1.1324 decline), which is a crucial support level.
The daily studies continue to show strong positive momentum, with multiple Moving Average bull-crosses and a converged 10/200DMA on track to form a golden cross. This underpins the action and keeps the upside in focus.
Dips should ideally hold above the Fibonacci support at 1.1648 and not exceed the 200DMA (1.1627) to mark a healthy correction before larger bulls regain full control for fresh extension higher.
The release of US July PCE Index will be a key event today, along with Friday's speech of Fed Chief Warsh in Jackson Hole Symposium, which are expected to provide more details about Fed's policy trajectory in the near term. Softer inflation numbers and a dovish stance by the central bank would benefit the single currency.