EUR/USD closes its best-performing week since June amid weak USD

EUR/USD gained more than 1% on Friday, rising near 1.0730.
The USD, measured by the DXY index, will close with a 1.40% weekly loss.
The dovish stance of the Fed and weak NFPs from October made the USD tumble.

Patricio Martín FXStreet

In Friday’s session, the EUR/USD soared to 1.0730, closing a 1.50% gaining week, its best performance since mid-June.

The daily market movers for the pair included a broad USD weakness due to the Federal Reserve (Fed) changing its tone to a more dovish approach and hinting that it is approaching to the end of its tightening cycle on Wednesday. As a reaction, US Treasuries tumbled to their lowest level since September, with the 2,5 and 10-year rates falling to 4.84, 4.50 and 4.57%, which added further selling pressure on the Greenback.

On Friday, the US reported that the US economy added fewer jobs than expected in October, while the unemployment rate increased to 3.9% and average hourly earnings increased lower than forecasted. As the labor market is showing signs of cooling down, it fueled additional dovish bets on the Fed and according to the CME FedWatch tool, the odds of a 25 basis point hike in December declined to nearly 9%, exacerbating the downside for the USD.

The market’s focus will now shift to the incoming data as, despite changing its tone, the Fed left the door open for further tightening. Until December, the bank will get two additional inflation readings and an extra jobs report.

EUR/USD Levels to watch

Upon evaluating the daily chart, a neutral to bullish outlook for the short term is seen, with the bulls gradually recovering their strength. The Relative Strength Index (RSI) points upwards in the bearish territory, hinting at a potential shift in momentum and bullish resurgence, while the Moving Average Convergence (MACD) histogram presents bigger green bars.

On the four-hour chart, the pair reached overbought conditions, indicating that in the immediate short term, a technical correction may be incoming.

Support levels: 1.0700, 1.0670, 1.0630.

Resistance levels: 1.0750,1.0770, 1.0800.

EUR/USD Daily Chart

EUR/USD

Overview
Today last price	1.0732
Today Daily Change	0.0110
Today Daily Change %	1.04
Today daily open	1.0622

Trends
Daily SMA20	1.058
Daily SMA50	1.0639
Daily SMA100	1.0809
Daily SMA200	1.0808

Levels
Previous Daily High	1.0668
Previous Daily Low	1.0566
Previous Weekly High	1.0695
Previous Weekly Low	1.0522
Previous Monthly High	1.0695
Previous Monthly Low	1.0448
Daily Fibonacci 38.2%	1.0629
Daily Fibonacci 61.8%	1.0605
Daily Pivot Point S1	1.057
Daily Pivot Point S2	1.0517
Daily Pivot Point S3	1.0468
Daily Pivot Point R1	1.0671
Daily Pivot Point R2	1.072
Daily Pivot Point R3	1.0772

Author

Patricio Martín

FXStreet

Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.

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