EUR/USD outlook: Remains constructive ahead of ECB – US NFP report
|EUR/USD
EURUSD holds in extended consolidation under new multi-week high (1.1454) but keeps firm tone that boosts prospects for further growth.
Bullish daily studies (strong positive momentum, MA’s in bullish configuration and thick daily cloud underpinning near-term action) contribute to positive outlook
Rising 10DMA tracks the price action since May 19, and offers solid support at 1.1373 (also near broken Fibo 61.8% of 1.1573/1.1065 pullback) followed by daily Tenkan-sen (1.1332) which should hold dips and keep lower trigger at 1.1286 (daily cloud top) intact.
All eyes are on today’s ECB decision and Friday’s US NFP report which would provide fresh direction signals.
The European Central Bank is widely expected to cut rates by additional 25 basis points and likely to signal pause in its year-long easing cycle until autumn.
Traders will be focusing on President Lagarde’s press conference for more details about ECB’s action in coming months.
Eurozone inflation is at CB’s target zone, however the policymakers remain cautious about potential stronger negative consequences, as escalation of trade war would fuel inflation.
On the other hand, the two recent reports from the US labor sector were mixed, as JOLTS showed stronger than expected results in May while hiring in US private sector slumped last month (ADP report).
US Nonfarm Payrolls rose by 177K in April and economists expect 130K increase in May, though some banks lowered their expectations after disappointing ADP report results that added to growing worries about unexpected NFP drop.
The US dollar is in a downward trajectory and may accelerate losses on NFP miss that would provide fresh boost to the single currency and open way for potential retest of 2025 peak (1.1573).
Res: 1.1453; 1.1473; 1.1500; 1.1547.
Sup: 1.1404; 1.1373; 1.1357; 1.1332.
Interested in EUR/USD technicals? Check out the key levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.