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#1 07-09-2020 11:33:06

johnedward
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From: Paris - France
Registered: 21-12-2009
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EUR/USD: the $1,1750 level is under high surveillance

EUR/USD: the $1,1750 level is under high surveillance


The pair remains close to its 20-day moving average (in dark blue in below chart), above the major technical zone at $1.1745/$1.1750. The momentum is being thwarted in the immediate future by German industrial production. The industrial production dynamic of the Euro Zone's largest economy in July was a clear disappointment, coming out at +1.1% on a monthly basis, compared with the expected +4.4%. The German trade surplus for July, expected at 15.0 billion, will be published tomorrow at 08:00 am (Europe-time).

In the meantime, and in the absence of U.S. benchmarks today due to a Labor Day holiday, forex traders continue to digest the employment figures released last weekend. As a result, forex traders have learned of the release of the US Bureau of Labor Statistics' Non Farm Payroll (NFP) report for private employment for last month. While job creation reached the target almost perfectly at +1,370,000 jobs, the dynamics of average hourly wages (+0.3% monthly) and especially the unemployment rate, exploded the target. The unemployment rate melted to 8.3% of the active population.

The Bureau of Labor Statistics says: "These improvements in the labour market reflect the continued recovery of economic activity that has been reduced due to the virus situation and efforts to contain it. Last month, an increase in employment largely reflected temporary hiring for this year's census. Notable job gains were also made in retail trade, professional and business services, recreation and hospitality, and education and health services".

As of right now, the pair is trading at $1.1818.

KEY CHART ELEMENTS

The eurodollar is in the high phase of a sideways movement, which remains firmly based at $1.1750. In the absence of a sufficiently attractive entry point, traders will avoid taking positions on the spot. We leave the major graphic and technical area of the 1.1750 under close surveillance. Breaking it would be synonymous with the release of selling energy.

MEDIUM TERM FORECAST

With regard to the key graphical factors we have mentioned, our opinion is neutral in the medium term on the pair's exchange rate.

We will maintain this neutral opinion as long as it remains between support at $1.1745 and resistance at $1.2000.

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