EUR/USD appreciates ahead of ECB speeches, Consumer Confidence data

• The Euro accelerates its recovery and approaches 1.1800 after bouncing at 1.1730.
• ECB and Fed officials are expected to provide further details about the banks’ monetary policies.
• Fed Chair Jerome Powell is expected to speak on Tuesday and might set the USD’s near-term direction.

EUR/USD has attracted some buyers to snap a three-day losing streak on Monday. The pair is trading at 1.1765 at the time of writing after bouncing from 1.1730 lows. The pair has broken a three-day losing streak as the US Dollar retreated ahead of a slew of Fed speakers. In Europe, ECB officials and the preliminary Consumer Confidence data will provide fundamental guidance for the Euro.

More than ten Fed policymakers are expected to deliver press conferences this week and provide their views about the central bank’s monetary policy plan. Investors will look with particular interest at the new member of the Fed’s Board of Governors, Stephen Miran, due to speak later on Monday. He is expected to defend his independence as policymaker and explain his reasons to opt for a jumbo interest rate cut last week, dissenting from the rest of the committee.

On Tuesday, Fed Chairman Jerome Powell will give a speech on the Economic Outlook at the Providence Chamber of Commerce, where he might delve into the need for a cautious approach to monetary policy. Last week, Powell’s stance offered some contrast to the market consensus, which prices in nearly one rate cut in each of the two monetary policy meetings remaining this year.

In Europe, European Central Bank (ECB) Chief Economist Philip Lane and German Bundesbank President Joachim Nagel might give some more clues about the ECB’s monetary policy. In between, the Eurozone’s Consumer Confidence will provide the main data point. Investors’ focus, however, will remain on Tuesday’s preliminary Manufacturing and Services Purchasing Managers Indexes (PMIs) for more insight into the region’s economic outlook.

Daily digest market movers: The US Dollar loses momentum with Fed monetary policy back into focus

• The US Dollar (USD)is breaking a three-day winning streak on Monday as the markets turn their focus to the Fed, with a string of policymakers speaking today and with a particular interest in Stephen Miran, who is expected to lay out the reasons to accelerate the monetary easing cycle.
• The Russian news agency Interfax announced that President Putin will make a statement on Monday. This announcement comes shortly after a Kremlin spokesperson dismissed accusations of violating the neighboring countries’ airspace and affirmed that those claims are aimed at escalating tensions.
• On Friday, Fitch upgraded Italian Credit ratings to BBB+ from BBB for the first time in four years, amid the country’s improved political stability and Prime Minister Giorgia Meloni’s success in reducing the fiscal deficit.
• Beyond Miran, the New York Fed president, John Williams, St louis President, Alberto Mussalem, Richmond Fed President Tom Barkin, and Cleveland Fed president, Beth Hammack are scheduled to meet the press on Monday.
• Over the weekend, ECB officials Martins Khazaks and Edward Scicluna assessed that the bank’s monetary policy is well placed at the moment and that there is no rush to cut interest rates further. These comments have offset ECB Mario Centeno’s dovish views, who pointed to a rate cut as the bank’s next move on Friday, and might have provided some support to the Euro.

Technical Analysis: EUR/USD is likely to find resistance at the 1.1795 area

EUR/USD’s correction from last week’s highs at 1.1918 found buyers right ahead of the trendline resistance from late August lows, at 1.1725. Technical indicators have turned higher, but the Relative Strength Index (RSI) is still below the key 50 level. The Moving Average Convergence Divergence (MACD) keeps showing bearish pressure.

To the upside, Friday’s high near 1.1795 is seen as the first relevant resistance area, ahead of the September 18 high, near 1.1850, and the September 16 high at 1.1878. Support levels are at the mentioned trendline and the intra-day low, at 1.1725. Further down, the next target would be the September 12 low at 1.1700, ahead of the September 11 low, near 1.1660.

(This story was corrected on September 22 at 11:00 GMT to say that the Federal Reserve Governor’s name is Stephen Miran, not Stephen Moram.)