EUR/USD Rebounds from Multi-Week Lows, Trading Above 1.0750
EUR/USD faced significant downward pressure, dropping to its weakest level in three weeks below 1.0750 on Friday after stronger-than-expected Non-Farm Payroll (NFP) data. However, weekend flows helped the pair recover losses, erasing the daily downturn. The Relative Strength Index (RSI) on the 4-hour chart has risen but remains below 50, indicating a lack of strong recovery momentum. The pair needs a decisive move above 1.0820 (200-day Simple Moving Average, Fibonacci retracement level of the latest uptrend) to use it as support and extend its recovery towards 1.0860 (static level, 50-period SMA) and 1.0900 (Fibonacci retracement level of 23.6%, 100-period SMA).
On the downside, 1.0760 (Fibonacci retracement level of 50%, 200-period SMA) is considered a crucial support level before 1.0700 (psychological level, Fibonacci retracement level of 61.8%). EUR/USD benefited from the broad weakness of the US Dollar (USD) on Thursday, recording a daily gain for the first time since November 28th. On Friday, the pair stabilized just below 1.0800 as market participants hesitated to take significant positions ahead of the US November employment report.
Positive changes in risk sentiment made it challenging for the USD to find demand in the latter half of Thursday, pushing EUR/USD higher. The US Non-Farm Payrolls (NFP) report is expected to show an increase of 180,000 jobs in November. A figure above 200,000 could prompt investors to reassess the timing of potential policy changes by the Federal Reserve (Fed) and bolster the USD initially. On the other hand, a disappointing figure below 150,000 could weaken the USD against its counterparts at the end of the week.
Meanwhile, annual wage inflation is anticipated to decrease to 4% from October's 4.1%, and the unemployment rate is predicted to remain unchanged at 3.9%. The US economic calendar will also include the preliminary University of Michigan Consumer Sentiment Survey for December. However, investors may overlook this report while focusing on scrutinizing labor market data details.
On the downside, 1.0760 (Fibonacci retracement level of 50%, 200-period SMA) is considered a crucial support level before 1.0700 (psychological level, Fibonacci retracement level of 61.8%). EUR/USD benefited from the broad weakness of the US Dollar (USD) on Thursday, recording a daily gain for the first time since November 28th. On Friday, the pair stabilized just below 1.0800 as market participants hesitated to take significant positions ahead of the US November employment report.
Positive changes in risk sentiment made it challenging for the USD to find demand in the latter half of Thursday, pushing EUR/USD higher. The US Non-Farm Payrolls (NFP) report is expected to show an increase of 180,000 jobs in November. A figure above 200,000 could prompt investors to reassess the timing of potential policy changes by the Federal Reserve (Fed) and bolster the USD initially. On the other hand, a disappointing figure below 150,000 could weaken the USD against its counterparts at the end of the week.
Meanwhile, annual wage inflation is anticipated to decrease to 4% from October's 4.1%, and the unemployment rate is predicted to remain unchanged at 3.9%. The US economic calendar will also include the preliminary University of Michigan Consumer Sentiment Survey for December. However, investors may overlook this report while focusing on scrutinizing labor market data details.
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