The EUR/USD currency pair managed to stay above the 1.0880 level, reaching as high as 1.0930, demonstrating that the bullish perspective remains intact. However, the pair encounters significant resistance ahead, and momentum appears to be waning. The daily chart illustrates the Euro maintaining its position above key bullish Simple Moving Averages (SMA) and still targeting 1.1000.
Technical Analysis:
In the 4-hour chart, technical indicators offer no definitive signals as the pair remains in a consolidation phase, likely to persist through Asian trading hours. A decline below 1.0880 could pave the way for an extension of the downward correction, potentially towards the 1.0840 area. On the upside, advances beyond 1.0950 seem improbable during the next trading session.
Fundamental Overview:
The EUR/USD experienced a rise on a relatively calm day, reclaiming 1.0900 and reaching 1.0935 before Nonfarm Payrolls and leading up to the Easter holiday. The Euro outperformed, while the DXY remained stable.
On Thursday, Germany reported a 2% increase in Industrial Production for February, consistent with the 4.8% gain in Factory Orders announced on Wednesday. Additionally, US data revealed a decrease in Initial Jobless Claims to 228,000 after seasonal adjustments, contributing to indicators suggesting a more relaxed labor market.
Friday’s NFP data will be crucial and the primary focus until Tuesday. Market consensus anticipates a 240,000 increase and the Unemployment rate remaining at 3.6% for March. Expectations for another Federal Reserve (Fed) rate hike at the next meeting continue to diminish. The employment figures could significantly impact bonds, the US Dollar, and the equity market.
As the Easter holiday approaches, price consolidation across the FX board appears probable. NFP may trigger some volatility, including erratic fluctuations. Impulses in EUR/USD could be short-lived, but a weekly close above 1.1000 may have implications.