EUR/USD Primed To Retest 1.1500 Resistance07 January, 2019 by Aayush Jindal in Market Analysis
- The Euro found support near the 1.1300 level and recovered against the US Dollar.
- There is a major bullish trend line formed with support at 1.1385 on the 4-hours chart of EUR/USD.
- The US Nonfarm Payrolls in Dec 2018 increased 312K, more than the 177K forecast.
- Today in the US, the Factory Orders figure for Nov 2018 will be released, which is forecasted to rise 0.7% (MoM).
EURUSD Technical Analysis
The Euro opened the New Year with a bearish tone and declined heavily against the US Dollar. Later, the EUR/USD pair formed a support base near 1.1300 and recovered above 1.1380.
Looking at the 4-hours chart, the pair traded as low as 1.1305 and later settled above the 1.1350 resistance plus 100 simple moving average (red, 4-hours). Buyers were successful in clearing the 50% Fib retracement level of the recent decline from the 1.1497 high to 1.1305 low.
The pair is currently trading well above the 1.1400 level and the 200 SMA (green, 4-hours), with a bullish angle. It must break the 1.1435 level and a connecting resistance trend line for a solid upward move towards the 1.1500 resistance.
An intermediate resistance is at 76.4% Fib retracement level of the recent decline from the 1.1497 high to 1.1305 low at 1.1451.
On the downside, there is a major bullish trend line formed with support at 1.1385 on the 4-hours chart of EUR/USD. The trend line is close to the 100 and 200 SMA, which are likely to act as strong supports near 1.1385.
Recently in the US, the Nonfarm Payrolls report for Dec 2018 was released by the US Department of Labor. The market was looking for an increase of 177K in jobs, more than the last 155K.
However, the result was positive as there was a sharp increase in the US NFP to 312K. Moreover, the last reading was revised up to 176K. On the flip side, there was a rise in the unemployment rate from 3.7% to 3.9%.
Overall, both EUR/USD and GBP/USD are likely to recover in the near term unless the US Dollar bulls take back control.
Economic Releases to Watch Today
- German Retail Sales for Nov 2018 (MoM) – Forecast 0.3%, versus -0.3% previous.
- German Retail Sales for Nov 2018 (YoY) – Forecast -0.9%, versus 5.0% previous.
- German Factory Orders for Nov 2018 (MoM) – Forecast -0.5%, versus +0.3% previous.
- US Factory Orders Nov 2018 (MoM) – Forecast +0.7%, versus -2.1% previous.