EUR/USD retraces gains, eases below 1.12 ahead of Draghi

Following the disappointing macro data from the U.S., the EUR/USD pair reached its session high at 1.1220 but lacked a follow-through ahead of ECB President Draghi gives his opening remarks at the fourth annual ECB Forum in Sintra, Portugal. As of writing, the pair was trading at 1.1188, down 0.06% on the day.

• Mario Draghi's speech at the 4th annual ECB Forum - Live Stream

Earlier in the session, the Chicago Fed National Activity Index fell into the negative area, suggesting a slowdown in economic growth in the U.S., while the Core Durable Goods Orders contracted for the second month in a row in May. Although the US Dollar Index fell to a fresh 12-day low at 96.80, it rose back above the 97 handle as the low summer trading volume is making it difficult for any type of price action to become sustainable.

Ahead of his speech, ECB's Draghi spoke at an event in Lisbon, where he said that interest rates had to be low for the growth to continue to recover. Although the pair didn't react to Draghi's earlier comments, his speech will be looked upon for desperately needed impetus.

Technical outlook

Valeria Bednarik, Chief Analyst at FXStreet writes, "...with the price having bounced from the 1.1170 region, where the 20 and 200 SMAs converge with bullish slopes. In the same chart, technical indicators have bounced from their mid-lines, but are still below previous daily highs. Should the advance extend beyond 1.1220, stops will likely be triggered, leading to a continued advance for the rest of the US session."

According to the analyst, supports are located at 1.1165, 1.1120 and 1.1075, while resistances align at 1.1220, 1.1260 and 1.1300.

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