EUR/USD treads water above 1.0900 ahead of US key data


Share:
  • EUR/USD alternates gains with losses above the 1.0900 mark.
  • Germany, EMU Final Services PMI surprised to the upside in January.
  • Markets’ attention will be on the US labour market and ISM Non-Manufacturing.

The single currency continues to digest Thursday’s post-ECB acute pullback and motivates the EUR/USD to trade within a tight range in the low-1.0900s on Friday.

EUR/USD focuses on data

Price action around EUR/USD remains muted so far in the European morning amidst increasing prudence among market participants in light of the upcoming US Nonfarm Payrolls for the month of January (185K exp).

In the meantime, investors continue to adjust to the latest ECB event amidst fresh comments from rate setters. On this, Board member Simkus suggested that the March meeting could not see the last 50 bps rate hike, at the time when he left the door open to another hike in May, although he did not give details on its potential size.

In the domestic calendar, final Services PMIs in Germany and the euro area came at 50.7 and 50.8, respectively, for the month of January. In addition, the ECB published its Survey of Professional Forecasters and now see inflation tracked by the HICP higher in 2023 and 2024 while Real GDP growth expectations appear largely unchanged.

Later in the NA session, the US Nonfarm Payrolls will take centre stage seconded by the Unemployment Rate and the ISM Non-Manufacturing.

What to look for around EUR

The pronounced upside pushed EUR/USD north of the key 1.1000 hurdle on Thursday, although the pair retreated markedly in the wake of the ECB event and retested the 1.0880 region.

In the meantime, price action around the European currency should continue to closely follow dollar dynamics, as well as the potential next moves from the ECB after the central bank delivered a 50 bps at its meeting on Thursday.

Back to the euro area, recession concerns now appear to have dwindled, which at the same time remain an important driver sustaining the ongoing recovery in the single currency as well as the hawkish narrative from the ECB.

Key events in the euro area this week: Germany, EMU Final Services PMI, ECB SPF (Friday).

Eminent issues on the back boiler: Continuation of the ECB hiking cycle amidst dwindling bets for a recession in the region and still elevated inflation. Impact of the Russia-Ukraine war on the growth prospects and inflation outlook in the region. Risks of inflation becoming entrenched.

EUR/USD levels to watch

So far, the pair is gaining 0.06% at 1.0916 and faces the next up barrier at 1.1032 (2023 high February 2) followed by 1.1100 (round level) and finally 1.1184 (weekly low March 31 2022). On the other hand, the breakdown of 1.0802 (weekly low January 31) would target 1.0766 (weekly low January 17) en route to 1.0648 (55-day SMA).

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content


Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content

Editors’ Picks

EUR/USD clings to gains near 1.0900 as USD remains weak

EUR/USD clings to gains near 1.0900 as USD remains weak

EUR/USD has regained its traction and climbed to the 1.0900 area in the American session following a technical correction early in the day. The persistent US Dollar weakness amid improving risk mood allows the pair to keep its footing in the second half of the day.

EUR/USD News

GBP/USD stabilizes above 1.2300 on BOE day

GBP/USD stabilizes above 1.2300 on BOE day

Following a pullback with the initial reaction to the Bank of England's policy announcements, GBP/USD has regained its traction and climbed above 1.2300. The pair remains on track to post gains for the second straight day as the US Dollar struggles to find demand.

GBP/USD News

Gold: XAU/USD approaches $2,000 amid broad US Dollar weaknes Premium

Gold: XAU/USD approaches $2,000 amid broad US Dollar weaknes

Spot gold retains its positive momentum and trades around $1,995 a troy ounce on Thursday. XAU/USD is extending its post-Fed advance, as the American central bank came out with a dovish message on Wednesday, triggering a dollar’s sell-off.

Gold News

Breaking: Terraform Labs founder Do Kwon arrested in Montenegro: Interior minister

Breaking: Terraform Labs founder Do Kwon arrested in Montenegro: Interior minister

Terraform Labs' founder Do Kwon is arrested, according to Minister of Interior of Montenegro Filip Adzic. This is a developing story and will updated

Read more

Ford (F) Stock News and Forecast: $3 billion EV loss leads shares to advance

Ford (F) Stock News and Forecast: $3 billion EV loss leads shares to advance

Ford (F) stock is demonstrating on Thursday exactly why automotive C suites are pivoting to electric vehicles. It is not because of the environment or due to easy profits. It is because the market likes it. 

Read more

Forex MAJORS

Cryptocurrencies

Signatures