EUR/USD: A dense macroeconomic calendar ahead of Jackson Hole

The EUR/USD is evolving in an environment where US monetary policy remains the main catalyst. The minutes of the Federal Reserve's latest meeting revealed an unusual divide among its members. A majority continues to prioritize the fight against inflation, perceived as fueled by higher tariffs, while part of the board is already advocating for rapid easing to counter the deterioration in the labor market, marked by rising unemployment. These differences make Jerome Powell's speech at the Jackson Hole symposium particularly anticipated: it could outline the roadmap for the coming months, in a context where repeated attacks from Trump are weakening the Fed's independence and fostering a climate of mistrust.

Political and trade tensions are reinforcing this uncertainty. Washington's pressure on the Chinese technology sector, restrictions on semiconductors, and the lack of tangible progress on the Ukrainian front are maintaining underlying volatility. These factors, combined with the markets' heightened sensitivity to the Fed's signals, are exacerbating the dollar's movements.

In Europe, the latest economic indicators provide a mixed but encouraging picture. Economic activity across the European bloc accelerated slightly in August, with a composite index at its highest in over a year. The surprise came from manufacturing, which returned to growth territory for the first time in over three years, driven in particular by Germany. Services continued to expand, but at a more moderate pace, while France showed signs of stabilisation after several months of a sharp decline. These results reflect a European economy that, despite pressure from inflation and trade tensions, remains resilient.

In the very short term, attention is focused on the US indicators expected this afternoon: weekly jobless claims, the Philadelphia Fed manufacturing index, PMI, and existing home sales. These publications will provide concrete information on the state of the US economy, on the eve of Jerome Powell's speech, and could adjust market expectations regarding the trajectory of interest rates.

Technically, the EUR/USD maintains a solid bullish trend above 1.14. This threshold represents a major pivot: as long as it remains intact, traders maintain a positive bias, envisioning an extension to higher levels, possibly 1.20, provided that the next catalysts - whether US data or the Jackson Hole speech - do not reverse this momentum.

MEDIUM-TERM FORECAST
In light of the key chart factors we have mentioned, our view is positive on the EUR/USD in the medium term.

Our entry point is at $1.1657. The price target for our bullish scenario is $1.2000. To protect your invested capital, we recommend placing a protective stop loss at $1.1380.

The expected return on this strategy is 343 pips and the risk of loss is 277 pips.