EUR/USD Facing Uphill Task Near 1.115013 January, 2020 by Aayush Jindal in Market Analysis
- EUR/USD found support near 1.1085 and it is correcting higher.
- There are many hurdles on the upside near 1.1145 and 1.1150.
- GBP/USD might decline heavily if it breaks the 1.3000 support area.
- The UK Industrial Production could decrease 0.2% in Nov 2019 (MoM).
EUR/USD Technical Analysis
After a steady decline, EUR/USD found support near the 1.1085 area. The Euro is currently correcting higher, but there are many hurdles for the bulls on the upside near 1.1150 against the US Dollar.
Looking at the 4-hours chart, the pair traded as low as 1.1085 and it is currently recovering. It traded above the 1.1100 resistance area. Besides, there was a break above the 23.6% Fib retracement level of the downward move from the 1.1205 high to 1.1085 low.
An immediate resistance is near the 1.1138 level. Moreover, there is a bearish trend line in place with resistance near 1.1140 on the same chart.
The 100 simple moving average (red, 4-hours) is also near the trend line and the 50% Fib retracement level of the downward move from the 1.1205 high to 1.1085 low.
Therefore, a clear break above the 1.1150 resistance area is needed for a decent upward move. The next key resistance is near the 1.1180 level, above which the pair could revisit the 1.1200 area.
Conversely, EUR/USD might struggle to move above 1.1140 and 1.1150. In the mentioned case, there is a risk of additional losses below the 1.1100 and 1.1080 support levels in the near term.
Fundamentally, the US nonfarm payrolls report for Dec 2019 was released by the US Bureau of Labor Statistics. The market was looking for an increase of 164K in jobs in Dec 2019.
The actual result was lower the market forecast, as the US nonfarm payrolls increased 145K. Moreover, the last reading was revised down from 266K to 256K.
The report added:
In December, the unemployment rate held at 3.5 percent, and the number of unemployed persons was unchanged at 5.8 million. A year earlier, the jobless rate was 3.9 percent, and the number of unemployed persons was 6.3 million.
Overall, EUR/USD might attempt an upside break above the 1.1150 resistance, but a clear break won’t be easy in the short term.
Upcoming Economic Releases
- UK Industrial Production for Nov 2019 (MoM) – Forecast -0.2%, versus +0.1% previous.
- UK Manufacturing Production for Nov 2019 (MoM) – Forecast -0.2%, versus +0.2% previous.