EUR/USD: Today is NFP day!

Currency traders will be monitoring the "temperature" of the 10-year US Treasury (10-year Treasury) in the early afternoon, following the publication of the highly anticipated federal report on private employment, the NFP (Non Farm Payrolls).

Here were the main consensus elements of the report: unemployment was expected to be stable at 4% of the working population, the number of job creations in the private sector excluding agriculture at 168,000, and the monthly increase in wages contained at +0.3%.

Alexandre Baradez (IG France) made the following reminder: "PCE inflation, the Fed's preferred inflation measure, the one it uses in its quarterly projections, still came out at 2.8% a few days ago, marking a sixth consecutive month without new progress towards the Fed's 2% target. It even rebounded a little over this two-quarter period, going from 2.6% to 2.8%. Even if we are far from the 2022 peak at 5.6%, the lack of progress has obviously been noticed by the Fed, which justified Jerome Powell's change of speech in December but also in January, with a change in the language elements concerning inflation and employment in the Fed's latest press release on Wednesday."

It is therefore this inflation / employment diptych that was at the heart of the traders' thinking this Friday.

The market naturally continues to assess, moreover, the consequences of the rather tense exchanges between China and the United States on customs surcharges. American President Donald Trump signed a decree on Saturday establishing customs surcharges of 10% on Chinese imports. This unsurprisingly provoked the ire of Beijing, which responded by establishing customs surcharges on imports of American liquefied natural gas and coal. New development on Wednesday: the American postal services announced on Tuesday that they would no longer accept "until further notice" parcels from China and Hong Kong. The American post office then reversed its decision yesterday early afternoon.

Right now, the EUR/USD is trading at $1.0365.

KEY CHART ELEMENTS
The 50-day moving average (in orange) continues to constitute a solid technical and graphical barrier. In the shorter term, it is even its 20-day counterpart (in dark blue) that acts as dynamic resistance. And this without the RSI oscillator positioning itself in the oversold zone. In the immediate future, the currency pair is tracing a negative harami structure in the upper part of the Bollinger bands. Once the perfect parity is reached, namely $1 for 1 euro, an energetic buying reaction of contestation could then take place.

MEDIUM-TERM FORECAST
In view of the key graphic factors that we have mentioned, our opinion is negative in the medium term on the EUR/USD.

Our entry point is at $1.0378. The price target of our bearish scenario is at $1.0001. To preserve the capital invested, we advise you to position a protective stop at $1.0521.

The expected return on this strategy is 377 pips and the risk of loss is 143 pips.