EUR/USD Forecast: A dead cat bounce or a comeback?

• EUR/USD is trading slightly higher at the wake of a new week.
• Markets are digesting the NFP on a day with a light calendar.
• The technical picture is balanced for the pair.

EUR/USD is trading above 1.1200, off the lows, but trading in a very narrow range. Is this another "dead cat bounce" that characterized EUR/USD moves recently? The pair may be bouncing ahead of the next slide. Or, it may be the beginning of a recovery, but we are unlikely to get answers today.

The limited moves can be seen as a "calm between the storms." 

Markets are digesting the US Non-Farm Payrolls report that was published on Friday. The world's largest economy gained 196K jobs in March, a welcome return to healthy increases after a very soft February. On the other hand, annual wage growth decelerated to 3.2%, thus implying the absence of inflationary pressures and allowing the Federal Reserve to remain patient and leave rates unchanged for a long time.

The "not too hot, not too cold" reports left the US Dollar stronger, but the move is fading. 

Three significant events on Wednesday

The next storm is due on Wednesday, with a trio of events. The European Central Bank will announce its decision. While no policy change is due, the ECB could reflect on the current slowdown and respond to the latest data. 

The second event is the critical EU Summit on Brexit. Unless another extension is granted, the UK will fall out of the EU on Friday. UK PM Theresa May asked for a short extension until June 30th, and the EU wants a longer one and to understand the endgame. The pound will likely move quite a bit, and EUR/USD could be dragged along.

The third event circles back to the jobs report. The US Fed publishes the FOMC Meeting Minutes from the last meeting in which they took their dovish twist and they may reveal more about thoughts about the global economy. 

In the meantime, Geman Trade Balance for February came out roughly within expectations at a surplus of 18.7 billion euros. The Sentix Investor Confidence will likely continue showing slight pessimism. Later on, US Factory Orders are due. All the figures tend to have a minimal impact on currencies. 

EUR/USD Technical Analysis

EUR/USD is trading in a narrow range and is battling the 50 Simple Moving Average on the four-hour chart. The Relative Strength Index is balanced around 50 while Momentum has also disappeared. All in all, this is a sideways movement. 

Support is found around 1.1205 which was a swing low last week. The next line is the 2019 trough at 1.1176. Lower, 1.1115 and 1.1025 date back to 2017. 

On the upside, 1.1235 was a stubborn cap last week. It is followed by 1.1255 that was April's high so far. 1.1285 and 1.1330 are next.