EUR/USD expects jobs report at 5-month high near 1.0550

• The US November employment report is coming.
• The dollar maintains its weak tone intact, at its lowest in months.
• EUR/USD firm above 1.0500, breaks away from 200-day MA.

EUR/USD is modestly higher on Friday, holding on to significant weekly gains and consolidating well above the 200-day MA and 1.0500. The dollar remains weak ahead of key data.

important data ahead

In the Eurozone there was a drop of 2.9% of the Production Price Index in October, a drop greater than expected of 2%. The annual rate went from 41.9% to 30.8%. The data reflects a deceleration in inflation, but does not change the expectation of more increases in interest rates by the European Central Bank.

In the US, at 13:30 GMT the employment report. The market consensus is for an increase in non-farm payrolls of 200,000 and for the unemployment rate to remain at 3.7%.

The labor market figures could have a great impact, through the influence on the expectations of the monetary policy of the Federal Reserve in the medium term. For December, a rise of 50 basis points is expected, which implies a drop compared to the previous rises of 75 points.

Signs of Fed easing have been behind recent dollar weakness. The Dollar Index (DXY) is falling for the third day in a row and has been trading at a low since late June. For their part, Treasury bond yields also continue to fall, putting further pressure on the greenback.

Panorama

EUR/USD rose as high as 1.0544 hours ago, hitting the highest level since June 28. It then pulled back but remained above 1.0500 and well away from the 200-day MA. In case of breaking above 1.0550, the next resistance is located at 1.0580.

The short and medium-term outlook remains bullish. In case of corrections, supports are seen at 1.0500 and then at 1.0450 and 1.0395. A dip below the latter would ease the bullish tone.

technical levels