EUR/USD hit a peak around 1.1830 in US trading on Monday before fading slightly into the New York close as prices drifted just above 1.1800. There was no move to test 2017 highs above the 1.1900 level.
Underlying dollar confidence remained fragile, although there was a reluctance to sell the US currency aggressively from current levels.
The Euro continued to drift slightly lower in early Europe with some selling in evidence after the break below 1.1800.
The German ZEW economic sentiment index declined to 10.0 for August from 17.5 the previous month. This was below expectations of 15.0 and the lowest reading since October 2016, although there was a small increase in the current conditions component.
EUR/USD drifted lower ahead of the US open, although there was support below 1.1750 amid notably light trading volumes.
The monthly increase in US house prices was held at 0.1% for June compared with consensus forecasts of a 0.4% advance and the year-on-year increase slowed to 6.5% from 6.9%.
The Richmond Fed manufacturing index was unchanged at 14 for August and above consensus expectations of 11.
There was further caution ahead of the Jackson Hole Symposium with tensions also increasing ahead of Wednesday’s speech from ECB President Draghi and EUR/USD held above 1.1750.
Any hawkish rhetoric from Draghi would trigger sustained upward pressure on the Euro while a more dovish slant and indications of concern over the Euro’s level would be likely to push the single currency lower.
EUR/USD 4-Hour Chart