Monday, October 7, 2019

EUR/USD

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Fundamental Highlights

The Euro has rallied a bit during Friday’s trading session, reaching towards 1.10 level after the US NFP number came out, but then sold off most of its gains, as the jobs number was at its lowest level since 1969. Traders still prefer the greenback to the Single currency, although the Fed easing narrative is a primary condition for dollar weakness, a 25-basis cut in October and even a follow-up cut in December might not lessen the USD yield advantage significantly, as the Fed still has much more advantage over the ECB. Therefore, until there’s evidence of the EU economic data-improving, traders may still prefer selling EURUSD on every tick higher towards 1.10-1.1025.

Technical Analysis

The Single currency bulls retested the 1.10 level for the second consecutive day; however, price quickly pulled back as it is still trading under a significant psychological and structural resistance area, and also below the 200-day moving average. The buyers will attempt to retest the crucial moving average once again today. The bears on the other hand, will protect the 1.1025 resistance level with everything they have, in an attempt to push price below the 50-day moving average to regain possession.

Support: 1.0960 / 1.0930
Resistance: 1.10 / 1.1025

Chart (H4)
EURUSD