EUR/USD: plenty of volatility but no clear direction

The euro continued its relatively volatile swings above $1.2000 as the forex market clearly has its eyes on US jobs. Forex traders are wondering about the timing of a tightening of the Fed's monetary policy, even though J. Powell was very reassuring on this point at the end of the last meeting of his Monetary Policy Committee. Ms Yellen, now Treasury Secretary, said in the run-up to an online event that a small increase in federal rates might be "necessary" to avoid "overheating" in a recovering economy.

In this context, the US jobs figures, published on Friday will support expectations. Especially since the health of jobs, combined with the dynamics of inflation, is an essential element in the Fed's thinking. The main statistical events on the agenda this week were the weekly unemployment benefit registrations yesterday and today'sl NFP (Non Farm Payroll) report on US private sector usage for last month.

The pair is currently flat. However, it regained a few pips yesterday morning with the support of the latest German industrial orders figures, up 3% on a monthly basis, well above expectations.

Right now, the pair is trading at around $1.2059.

KEY CHART ELEMENTS
The crossing of the upper limit of a former bearish channel is now fully validated, by the increase in volatility in particular on Friday, 23 April, and by the consecutive crossing, in the wake, without any form of hesitation, of the 100-day moving average (in orange). However, a neutral opinion is proposed in the absence of a quality entry point. The marubozu drawn on Friday can be used as a framework to define a future lateralization phase.

MEDIUM-TERM FORECAST
Given the key chart factors we have mentioned, our medium-term view on the Euro Dollar (EURUSD) is neutral.

We will maintain this neutral view as long as the EUR/USD is positioned between support at $1.1964 and resistance at $1.2100.