EUR/USD Current Price: 1.1762
- An upbeat US employment report revived hopes for soon to come tapering.
- The US Senate moved forward with the bipartisan infrastructure bill.
- EUR/USD is technically bearish, heading to March’s monthly low at 1.1703.
The EUR/USD pair fell on Friday to close the week in the 1.1760 price zone as the dollar rallied on the heels of an upbeat employment report. The US added 943K new jobs in July, while the Unemployment rate contracted to 5.4%, both largely beating the market’s expectations. The Underemployment Rate shrank to 9.2%, while the Participation Rate increased to 61.7%. All figures remain below pre-pandemic levels but clearly indicate the kind of progress the Federal Reserve needs to proceed with tapering.
Meanwhile, European data kept disappointing market participants. German Industrial Production contracted 1.3% MoM in June, while it advanced 5.1% YoY in the same month, largely missing expectations. Over the weekend, the US Senate advanced with the bipartisan infrastructure bill, although it still requires a final vote, which date remains unclear.
On Monday, Germany will publish the June Trade Balance, while the EU will release August Sentix Investor Confidence, foreseen at 29 from 29.8 previously. The US won’t publish relevant macroeconomic data.
EUR/USD short-term technical outlook
The EUR/USD pair is bearish, according to the daily chart. It has accelerated its slump after breaking below a now bearish 20 SMA, while the longer ones remain far above the current levels. Technical indicators crossed their midlines into negative territory, maintaining their firmly bearish slopes. In the 4-hour chart, the risk is also skewed to the downside, given that the pair develops below all of its moving averages, with the shorter ones crossing directionless longer ones. Technical indicators reached oversold conditions without signs of exhaustion. The immediate support level is 1.1751, July low, followed by 1.1703, March monthly low.
Support levels: 1.1750 1.1705 1.1660
Resistance levels: 1.1790 1.1830 1.1880
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