EUR/USD Forecast: United States employment data taking centre stage

Valeria Bednarik FXStreet

EUR/USD Current price: 1.0869

The US Dollar turned higher as risk aversion took over financial markets.
United States employment figures could affect the upcoming Federal Reserve decision.
EUR/USD retreated from above 1.0900, but additional losses not clear yet.

The EUR/USD pair peaked at 1.0915 early on Tuesday, as the US Dollar gathered bearish momentum in Monday's American session following tepid growth-related United States (US) data. The ISM Manufacturing PMI unexpectedly contracted to 48.7 in May from 49.2 previously, worse than the 49.6 expected. In the end, the USD safe-haven condition won the battle, pushing EUR/USD towards the 1.0860 price zone mid-European session.The pair maintains its negative tone amid a scarce European macroeconomic calendar and as investors await US employment-related figures. The country will release April JOLTS Job Openings, foreseen at 8.34 million, and Factory Orders for the same month, expected to have posted a modest 0.6% advance in the month.

This week's focus will be on US employment data, as speculative interest will try to assess its impact on future Federal Reserve (Fed) monetary policy decisions. In the next few days, the US will publish the ADP survey on private job creation, weekly unemployment figures and the Nonfarm Payrolls (NFP) report.

EUR/USD short-term technical outlook

The daily chart for the EUR/USD pair showed it trimmed half of Monday's gains, but the bearish potential remains limited. The pair continues to develop above all its moving averages, with the 20 Simple Moving Average (SMA) maintaining its upward slope above directionless 100 and 200 SMAs. Technical indicators turned south but lack strength enough to confirm a bearish extension. The Momentum indicator currently stands at around its 100 line, while the Relative Strength Index (RSI) indicator barely retreats from near overbought readings, suggesting sellers lack power.

In the near term, EUR/USD bearish potential also seems limited. The intraday decline stalled just above a mildly bullish 20 SMA, which stands above advancing longer moving averages. Finally, technical indicators have retreated after flirting with overbought conditions but lost their downward strength well above their midlines. The intraday peak fell short of testing the resistance level at 1.0910. Once above the latter, bulls will likely gain more confidence.

Support levels: 1.0820 1.0780 1.0740
Resistance levels: 1.0910 1.0960 1.1000

Premium

You have reached your limit of 3 free articles for this month.

Start your subscription and get access to all our original articles.

Subscribe to Premium Sign In

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

EUR/USD struggles near 1.1850, with all eyes on US CPI data

EUR/USD holds losses while keeping its range near 1.1850 in European trading on Friday. A broadly cautious market environment paired with a steady US Dollar undermines the pair ahead of the critical US CPI data. Meanwhile, the Eurozone Q4 GDP second estimate has little to no impact on the Euro.

GBP/USD recovers above 1.3600, awaits US CPI for fresh impetus

GBP/USD recovers some ground above 1.3600 in the European session on Friday, though it lacks bullish conviction. The US Dollar remains supported amid a softer risk tone and ahead of the US consumer inflation figures due later in the NA session on Friday.

Gold remains below $5,000 as US inflation report looms

Gold retreats from the vicinity of the $5,000 psychological mark, though sticks to its modest intraday gains in the European session. Traders now look forward to the release of the US consumer inflation figures for more cues about the Fed policy path. The outlook will play a key role in influencing the near-term US Dollar price dynamics and provide some meaningful impetus to the non-yielding bullion.

US CPI data set to show modest inflation cooling as markets price in a more hawkish Fed

The US Bureau of Labor Statistics will publish January’s Consumer Price Index data on Friday, delayed by the brief and partial United States government shutdown. The report is expected to show that inflationary pressures eased modestly but also remained above the Federal Reserve’s 2% target.

The weekender: When software turns the blade on itself

Autonomous AI does not just threaten trucking companies and call centers. It challenges the cognitive toll booths that legacy software has charged for decades. This is not a forecast. No one truly knows the end state of AI.

Solana Price Forecast: Mixed market sentiment caps recovery

Solana (SOL) is trading at $79 as of Friday, following a correction of over 9% so far this week. On-chain and derivatives data indicates mixed sentiment among traders, further limiting the chances of a price recovery.