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EUR/USD showed small gains last week and recorded a weekly close above the 1.18 level for the first time since January 2018. There are three events in the upcoming week, including PMIs. Here is an outlook at the highlights and an updated technical analysis for EUR/USD.  
Eurozone Sentix Investor Confidence remained in negative territory, which indicate expansion. Still, the indicator improved from -18.2 to -13.4. German ZEW Economic Sentiment pointed to stronger investor confidence, climbing from 59.0 to 71.5. On the inflation front, German CPI declined by 0.5%, the second decline in three months. The week wrapped up with Eurozone GDP for Q2, with the second read of -12.1% confirming the first reading.
In the US, consumer inflation was unchanged at 0.6% in July. The core reading improved to 0.6%, up from 0.2% beforehand. There was good news on the employment front, as unemployment claims fell to 963 thousand, down from 1.186 million. This marked the first time that new claims have fallen below the 1-million mark since mid-March, before the spread of Covid-19. Retail sales reports were mixed. The core reading came in at 1.9%, above the estimate of 1.3%. However, the headline read posted a gain of 1.2%, shy of the estimate of 2.0%.

EUR/USD daily chart with support and resistance lines on it. Click to enlarge:

  1. Current Account: Wednesday, 8:00. The eurozone current account surplus fell to 8.0 billion, the third straight month that the surplus has narrowed. We now await the June data.
  2. Inflation Report: Tuesday, 9:00. Inflation climbed rose to 0.3% in June, up from 0.1%. The forecast for July stands at 0.4%. The core reading ticked lower from 0.9% to 0.8% in June. Analysts expect a rebound in July, with an estimate of 1.2%.
  3. PMIs: Friday, 7:15 in France, 7:30 in Germany, and 8:00 for the whole eurozone. In June, PMIs across the eurozone posted readings above 50, which indicates expansion. This trend is expected to continue in the July releases. German Manufacturing PMI is expected to come in at 52.2, the Eurozone PMI at 52.7 and the French indicator at 53.0.
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EUR/USD Technical analysis

Technical lines from top to bottom:

We start with resistance at 1.2174.

This is followed by 1.2004, just above the psychologically important 1.20 level.

1.1930 is next.

1.1850 is a fluid line. Currently, it is an immediate resistance line.

1.1725 is the first support line.

1.1650 has some breathing room in support.

1.1573 (mentioned  last week) is next.

1.1470 has held since mid-March. It is the final support line for now.


I am neutral on EUR/USD

The US dollar continues to struggle and the euro has taken advantage, testing the 1.19 line earlier in August. However, US numbers have been showing some improvement, so the dollar could rebound.

Further reading:

Safe trading!