EUR/USD: NFP disappoints, but EUR can't rally

Valeria Bednarik FXStreet

EUR/USD Current price: 1.0645

View Live Chart for the EUR/USD

The US Nonfarm Payroll report was a big miss, triggering a sharp downward move in the greenback against all of its major rivals, as the world's largest economy added just 98,000 jobs, against market's expectations of 180K. The unemployment rate fell to 4.5%, the lowest in almost 10 years, whilst average wages rose 0.2% monthly basis, matching February figure, and by 2.7% from March 2016 to March 2017, down from 2.8% in the prior month. Equities and yields softened after the news, while the EUR/USD pair jumped up to 1.0664 from a fresh 3-week low of 1.0622. The pair however, quickly retreated from the mentioned high, as the market is more willing to sell the pair at higher levels than going long in the EUR. Nevertheless, chances of a strong dollar advance are now limited.

Technically, the pair remains within its early weekly range, unable to rally beyond the 1.0670 price zone, and with the 1 hour chart showing that the price failed to surpass its 100 SMA as it struggles around the 20 SMA. Technical indicators have turned north, but remain below their mid-lines, not enough to support further gains. In the 4 hours chart, the RSI indicator has barely bounced from oversold territory, whilst the price remains below all of its moving average, also signaling a limited upward scope. Above the mentioned short term resistance, the pair faces a stronger one around 1.0710, and only a steady recovery above this last can implicate a bullish continuation.

Support levels: 1.0620 1.0590 1.0565

Resistance levels: 1.0675 1.0710 1.0750

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.

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