- The EUR/USD rose on Thursday, boosted by a weaker US Dollar ahead of NFP.
- There is a short-term positive bias for the pair, but it is limited.
- The Euro is still under pressure amid expectations of rate cuts from the ECB.
The EUR/USD rose from weekly lows near 1.0750 and climbed above 1.0800 on Thursday, boosted by a weaker US Dollar. The focus now turns to US official employment data, which is due to be released on Friday.
In Germany, Industrial Production dropped by 0.4% in October, contrary to expectations of a 0.2% increase. This report contributes to a negative economic outlook for the region. On Friday, the Eurozone will release the final reading of the November Consumer Price Index, which is not expected to bring any surprises, with the annual rate at 3.2%.
The US Dollar dropped across the board on Thursday as US yields continued to decline. The 10-year yield dropped from 4.17% to 4.11%, and the 2-year yield fell to 4.57%, approaching recent lows. Yields in Europe also moved with a negative trend as markets anticipate the European Central Bank (ECB) cutting rates in March of next year. The Federal Reserve (Fed) is also seen loosening monetary policy in the future. This divergence weighed on the EUR/USD during the last session, but the Greenback lost its momentum, influenced by some improvement in risk sentiment and ahead of another US job report that is expected to provide more evidence of a softer labour market.
Data released on Thursday showed a decline in Continuing Claims after last week's surge to 1.861 million, although they remain near multi-year highs. On Friday, the official employment report is expected to show an increase in payrolls by 180,000, surpassing the 150,000 recorded in September.
EUR/USD short-term technical outlook
-638375772274645947.png)
The EUR/USD rebounded from the 100-day Simple Moving Average (SMA) but held under the 20-day SMA. Technical indicators on the daily chart are mixed, with Momentum below the midpoint and the Relative Strength Index (RSI) turning north. On the weekly chart, the pair found support at the 20-week SMA; Euro bulls need to avoid a weekly close below 1.0750.
On the 4-hour chart, the pair is trending slightly above the 20-SMA and an upward trendline. Technical indicators favor the upside for the following hours. However, the upside may be limited due to a potential lack of volatility ahead of NFP, which could lead to a consolidation around 1.0800. A break below 1.0780 could weaken the Euro, while a move above 1.0830 could provide a boost.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
EUR/USD clings to daily gains near 1.0300 after US PMI data
EUR/USD trades in positive territory at around 1.0300 on Friday. The pair breathes a sigh of relief as the US Dollar rally stalls, even as markets stay cautious amid geopolitical risks and Trump's tariff plans. US ISM PMI improved to 49.3 in December, beating expectations.
GBP/USD holds around 1.2400 as the mood improves
GBP/USD preserves its recovery momentum and trades around 1.2400 in the American session on Friday. A broad pullback in the US Dollar allows the pair to find some respite after losing over 1% on Thursday. A better mood limits US Dollar gains.
Gold retreats below $2,650 in quiet end to the week
Gold shed some ground on Friday after rising more than 1% on Thursday. The benchmark 10-year US Treasury bond yield trimmed pre-opening losses and stands at around 4.57%, undermining demand for the bright metal. Market players await next week's first-tier data.
Stellar bulls aim for double-digit rally ahead
Stellar extends its gains, trading above $0.45 on Friday after rallying more than 32% this week. On-chain data indicates further rally as XLM’s Open Interest and Total Value Locked rise. Additionally, the technical outlook suggests a rally continuation projection of further 40% gains.
Week ahead – US NFP to test the markets, Eurozone CPI data also in focus
King Dollar flexes its muscles ahead of Friday’s NFP. Eurozone flash CPI numbers awaited as euro bleeds. Canada’s jobs data to impact bets of a January BoC cut. Australia’s CPI and Japan’s wages also on tap.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.