- The dollar maintains important portfolio values after the NFP.
- Employment reports boost dollar and yields.
- EUR/USD is headed for a modest weekly loss.
EUR/USD bottomed at 1.0140 on Friday and then bounced back. The recovery of the euro was not strong enough to recover the 1.0200. At the end of the week, the pair looks vulnerable due to the strengthening of the US dollar.
The July employment report showed that the US economy added 528,000 jobs, much more than expected. US yields jumped after the report boosting the dollar overall.
After the NFPs, the key report next week will be the US inflation numbers. The CPI for July will be published on Wednesday and a monthly increase of 0.2% is expected. The IPP will be published on Thursday. The numbers will be key to Fed rate expectations. The jobs report left the door open for aggressive tightening.
Another week in the range
Despite the FOMC and NFPs, EUR/USD continues to move sideways, as it has since mid-July. The Euro continues to be rejected from around the 1.0280 area, while at the same time still finding support around 1.0100.
“The weekly chart shows that the long-term bearish stance is still intact. Technical indicators remain negative, Momentum advancing but RSI extending its consolidation around 31. At the same time, the 20 SMA heads lower. south almost vertically, about 350 points above the current level but more than 800 points below the longest, a sign of bear dominance,” explains Valeria Bednarik, Chief Analyst at FXStreet.
According to Bednarik, a break below 1.0105 will open the door for a retest of parity. To the upside, he argues that “EUR/USD would need to accelerate through 1.0280 to shed negative stance and extend its recovery towards 1.0360 first and on track to 1.0440 after”.
|last price today||1.0163|
|daily change today||-0.0083|
|Today’s daily variation in %||-0.81|
|Daily opening today||1.0246|
|Previous daily high||1.0254|
|Previous Daily Low||1.0154|
|Previous Weekly High||1.0258|
|Previous Weekly Low||1.0097|
|Previous Monthly High||1.0486|
|Previous Monthly Low||0.9952|
|Daily Fibonacci of 38.2%.||1.0216|
|Daily Fibonacci of 61.8%||1.0192|
|Daily Pivot Point S1||1.0182|
|Daily Pivot Point S2||1.0119|
|Daily Pivot Point S3||1.0083|
|Daily Pivot Point R1||1.0281|
|Daily Pivot Point R2||1.0317|
|Daily Pivot Point R3||1.0381|
Source: Fx Street