EUR/USD hits 2-1/2 week lows, below 1.1700 handle ahead of Fed minutes

The EUR/USD pair traded with a bearish bias for the third consecutive session and touched a 2-1/2 week low level of 1.1680 during early NA session on Wednesday.

With markets quickly digesting today's disappointing US housing market data, a combination of persistent greenback demand and a weaker sentiment around the common currency dragged the pair to its lowest level since July 28. In fact, the post-US data US Dollar dip was bought into and has been one of the key factors contributing to the pair's sharp retracement over the past hour or so. 

Meanwhile, the shared currency was also being weighed down by the latest headlines that the ECB President Mario Draghi will not be discussing monetary policy outlook at the upcoming Jackson Hole Symposium, which faded market expectations of a possible ECB tapering at the next meeting in September.

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The fall, however, has been limited and the pair bounced off around 15-pips from lows amid repositioning trade ahead of today's key event risk - the much-awaited FOMC meeting minutes, which would drive the USD in the near-term and eventually provide fresh impetus for the pair's next leg of directional move.

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Technical outlook

Valeria Bednarik, Chief Analyst at FXStreet writes, "the 4 hours chart shows that the risk remains towards the downside, with the price well below its 20 and 100 SMAs, and technical indicators hovering near oversold territory, with no signs of changing course. The key 1.1690 support will likely hold for now, although a hawkish surprise from the Fed can push the price below it, something quite unlikely but not impossible, moreover considering the lower highs seen recently coupled with the disappointment generated by Draghi earlier today."