The Euro-dollar pair retreated from the highs in the last week of August and some of the events that are expected to affect the pair include the ECB rate decision, PMIs, German Industrial data and the US Nonfarm Payrolls among others. The US nonfarm Employment Change measures the change in the number of newly employed people in the US, excluding workers in the farming industry. A higher reading than the market forecast turns the market bullish in favor of the dollar.
Job creation is one of the most important leading indicators of overall economic activity. The release of the US Nonfarm employment change is highly anticipated by the markets and an expected reading could affect the direction the pair takes.
Non-Farm Employment Change dropped sharply from 195 thousand in July to just 162 thousand in August. This was well below the estimate of 184 thousand. The markets are expecting a substantial improvement in the upcoming release, with an estimate of 177 thousand.
As we begin the month of September, there are several reasons to worry about the euro: a third bailout for Greece seems inevitable, German data has been sputtering and Draghi can add to the weight on the euro.
As well, the dollar has support of its own, with increasing speculation that the Fed will begin tapering in September, perhaps by $15 billion. Currently a “September taper” is a close call for the Fed and the markets. In the last days of summer, we could see some more volatility, but no clear choice of direction. So, the overall sentiment is bearish on EUR/USD towards this release.
Here are the scenarios for the report. If it comes within the expectation, that is 172k-182k, then the euro-usd is likely to rise within range, with a slim chance of breaking higher. If above expectations, 183k-190k, the pair might break below one support level. If well above the expectation, over 190k, the dollar will be strengthened and a second support line might be crossed.
If below expectation, that is, 164k-171k, the pair will rise above one line of resistance and if the reading is well below the market expectation, the pair has a chance of breaking the second resistance line. Some of the technical levels to watch out for are as follows from top to bottom 1.3350, 1.33, 1.3240, 1.3175, 1.31 and 1.3050.
Job creation is one of the most important leading indicators of overall economic activity. The release of the US Nonfarm employment change is highly anticipated by the markets and an expected reading could affect the direction the pair takes.
Non-Farm Employment Change dropped sharply from 195 thousand in July to just 162 thousand in August. This was well below the estimate of 184 thousand. The markets are expecting a substantial improvement in the upcoming release, with an estimate of 177 thousand.
As we begin the month of September, there are several reasons to worry about the euro: a third bailout for Greece seems inevitable, German data has been sputtering and Draghi can add to the weight on the euro.
As well, the dollar has support of its own, with increasing speculation that the Fed will begin tapering in September, perhaps by $15 billion. Currently a “September taper” is a close call for the Fed and the markets. In the last days of summer, we could see some more volatility, but no clear choice of direction. So, the overall sentiment is bearish on EUR/USD towards this release.
Here are the scenarios for the report. If it comes within the expectation, that is 172k-182k, then the euro-usd is likely to rise within range, with a slim chance of breaking higher. If above expectations, 183k-190k, the pair might break below one support level. If well above the expectation, over 190k, the dollar will be strengthened and a second support line might be crossed.
If below expectation, that is, 164k-171k, the pair will rise above one line of resistance and if the reading is well below the market expectation, the pair has a chance of breaking the second resistance line. Some of the technical levels to watch out for are as follows from top to bottom 1.3350, 1.33, 1.3240, 1.3175, 1.31 and 1.3050.
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