EUR/USD climbs toward 1.0660s after US jobless claims increased
|- The Euro remains above the 1.0600 figure, eyeing a year-end close above the figure.
- US Initial Jobless Claims exceeded the previous week’s reading, showing the labor market is easing.
- EUR/USD: Flat, but if it clears 1.0700, it could reach a new MTD high; otherwise, consolidation around 1.0600 is on the cards
The Euro (EUR) held to its gains vs. the American Dollar (USD) as sentiment improved ahead of the last trading day of 2022. Data from the United States (US) showed a slight jump in unemployment claims, boosting the EUR/USD, while China’s Covid-19 relaxing restrictions keep investors nervous. At the time of writing, the EUR/USD is trading at 1.0660.
An increase in US unemployment claims weighed on the US Dollar
US economic data revealed by the Department of Labor (DoL) featured Initial Jobless Claims for the week ended on December 24, which jumped to 225K, in line with expectations, and 9K above the previous week’s record. In the meantime, continuing claims rose to 1.7 million in the week that ended on December 17, the highest since early February.
Aside from this, since authorities relaxed its zero-tolerance policy, the jump in Covid-19 cases in China is overwhelming the country’s healthcare system. Also, flights from China that landed in Italy triggered a reaction from Western countries, with some reimposing tests for people flying from China.
Elsewhere, the Russian invasion of Ukraine escalated, with newswires reporting shelling in Kyiv and other cities.
In the meantime, the Eurozone economic docket featured Spain Retail Sales MoM, exceeding the previous month’s 0.4%, jumped 3.8%, while the EU’s M3 Money Supply for November dived to 4.8% YoY, vs. estimates of 5%.
The Eurozone economic calendar will feature Spain’s inflationary readings ahead of the week, while the US docket will release the Chicago PMI for December.
EUR/USD Price Analysis: Technical outlook
Choppy trading conditions in the EUR/USD continued, as usually happens, for the last ten days of the year. However, oscillators like the Relative Strength Index (RSI) suggest the shared currency could begin the year on a higher note while the Rate of Change (RoC) is flat. If the EUR/USD clears December’s 28 high of 1.0674, that could pave the way for a 1.0700 test. Once cleared, the next resistance would be the MTD high of 1.0736. As an alternate scenario, the EUR/SUD first support would be 1.0600, followed by last week’s low of 1.0573 and the 20-day Exponential Moving Average (EMA) at 1.0564.
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