EUR/USD Stuck In Broad Range Below 1.110009 December, 2019 by Aayush Jindal in Market Analysis
- EUR/USD struggled to settle above the 1.1100 resistance area.
- GBP/USD remained strong and surged above the 1.3100 resistance area.
- The US nonfarm payrolls increased 266K in Nov 2019, better than the market forecast of 180K.
- The US unemployment rate declined from 3.6% to 3.5% in Nov 2019.
EUR/USD Technical Analysis
After forming support near 1.1000, the Euro started a decent upward move against the US Dollar. EUR/USD recovered above 1.1050 and 1.1080, but it struggled to settle above the 1.1100 resistance area.
Looking at the 4-hours chart, the pair traded as high as 1.1116 and recently started a downside correction. There was a break below the 1.1100 and 1.1080 levels.
Moreover, the pair traded below the 38.2% Fib retracement level of the upward move from the 1.0981 low to 1.1116 high. On the downside, there are a few important supports near the 1.1040 level and the 100 simple moving average (red).
Besides, the 50% Fib retracement level of the upward move from the 1.0981 low to 1.1116 high is near the 1.1048 level. Therefore, a downside break below the 1.1040 support could push EUR/USD back towards the 1.1000 support area.
Otherwise, the pair may perhaps climb back above 1.1080. The main resistances are 1.1100 and 1.1120, above which the pair is likely to accelerate towards the 1.1150 level.
Fundamentally, the US nonfarm payrolls figure for November 2019 was released by the US Bureau of Labor Statistics. The market was looking for an increase of 180K in jobs, more than the last 126K (now revised to 156K).
The actual result was positive, as the total nonfarm payroll employment rose by 266,000 in November 2019. More importantly, the US unemployment rate declined from 3.6% to 3.5%.
The report added:
Job growth has averaged 180,000 per month thus far in 2019, compared with an average monthly gain of 223,000 in 2018. In November, notable job gains occurred in health care and in professional and technical services.
Overall, EUR/USD must stay above 1.1040 to start a fresh upward move. On the other hand, GBP/USD is showing a lot of bullish signs after this past week’s rally above 1.3000 and 1.3100.
Upcoming Economic Releases
- Swiss Unemployment Rate Nov 2019 – Forecast 2.3%, versus 2.3% previous.
- Germany’s Trade Balance for Oct 2019 – Forecast €19.0B, versus €19.2B previous.