EUR/USD Gains Extend as Dovish Powell Fuels Rally

The EUR/USD pair continued its upward trajectory last week. Dovish remarks from Powell at the Jackson Hole symposium further fueled these gains.

The value of the euro against the US dollar recently reached its highest levels since July 2023. However, there are emerging signs suggesting that the price may start to consolidate or possibly experience a slight downward correction.

EUR/USD Daily Time Frame chart. Source: xStation 5

Technical Analysis

Looking at the US dollar index chart, we can see that the price has hit its lowest point in the last two years, around 100.600 points. This area could prompt a new upward movement in EUR/USD if there is a break below this support zone.

On the other hand, if buyers regain control at this support level, the EUR/USD pair may begin to slow its upward trend.

USD index, daily time frame chart. Source: xStation 5
 

Henrique Tomé,
Analyst Portugal