- EUR / USD retreats from daily highs around 1.1560 amid the weakness of the US dollar.
- EUR / USD: If it does not hold at 1.1500, the pair could fall towards 1.1348.
- Market sentiment is pessimistic as investors believe the Fed’s bond phasing announcement is imminent.
The EUR/USD It rises above Thursday’s daily highs and is trading at 1.1572, gaining 0.17% during the American session at the time of writing. At the beginning of the US session, it reached a daily high at 1.1586, but like most G8 currencies, it reversed the move. Despite a lousy US employment report, the market seems aware that nothing will stop the Federal Reserve from starting the bond phase-out process at the November FOMC meeting.
In addition, market sentiment is pessimistic with the US equity markets falling, US Treasury yields rising and the US dollar clinging to 94.00, shedding 0.11%. against a basket of six pairs, limiting the movement of the EUR / USD towards 1.1600.
On the macroeconomic front, the Bureau of Labor Statistics (BLS) released the Non-Farm Payroll report for September, which showed an increase of 194,000 jobs added to the economy, down from the 500,000 predicted by economists who threaten to delay a decision from bond reduction. However, once the knee-jerk reaction faded, the EUR / USD price action reinforced the market’s belief that the Fed’s QE reduction announcement could be made in November.
EUR / USD Price Forecast: Technical Outlook
Daily chart
EUR / USD is trading well below the daily moving averages (DMA), which suggests that the downtrend is intact. If the 1.1600 level does not recover, the EUR / USD remains pressed lower. Also, momentum indicators like the Relative Strength Index (RSI) at 34, well below the 50 midline, pointing lower, keep the door open for further losses.
As EUR / USD heads south, the first support level would be the 2021 low at 1.1528, followed by the psychological 1.1500 level. A break below the latter could push the price towards June 10, 2020, high at 1.1422, followed by June 23, 2020, high at 1.1348.
ADDITIONAL LEVELS
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