European currencies are holding near four-week highs at the start of the week. Following the volatile swings sparked by Jerome Powell’s remarks at the Jackson Hole symposium, the market has yet to form a clear scenario: the dollar corrected but then came under renewed pressure. As a result, EUR/USD and GBP/USD managed to test key resistance levels, though no breakout from their sideways ranges has yet occurred. The next move will largely depend on upcoming macroeconomic data releases from Europe, the UK, and the US, which could shift the short-term outlook.

Today, market participants are focused on the release of business activity indices and producer prices in Europe, along with inflation (CPI) data in Italy and the euro area. The significance of these releases is heightened by their potential to shape expectations for the European Central Bank’s future policy. Tomorrow, a batch of important statistics is due from the UK.

GBP/USD

The GBP/USD pair yesterday tested a key resistance at 1.3550. Technical analysis suggests a potential move towards 1.3600 if the price maintains its current upward momentum. This growth scenario could be invalidated should support at 1.3500 be broken.

Key events that could influence GBP/USD:

• Today at 17:00 (GMT+3): US ISM Manufacturing PMI
• Tomorrow at 11:30 (GMT+3): UK Services PMI

EUR/USD

At the start of the week, buyers of the single European currency pushed the pair towards the upper boundary of the medium-term sideways range at 1.1740. Technical analysis points to a possible decline towards 1.1620–1.1640 if the pair rebounds from 1.1740. Conversely, a consolidation above 1.1740 could signal a resumption of the upward trend.

Key events that could influence EUR/USD:

• Today at 12:00 (GMT+3): Eurozone CPI
• Today at 14:30 (GMT+3): Speech by ECB representative Elderson
• Today at 17:00 (GMT+3): Speech by Bundesbank President Nagel

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