EUR/USD nudges up, approaching 1.0800 as ADP data disappoints

• The Euro bounces up and approaches intra-day highs at 1.0800.
• Weak US ADP data sends the UD Dollar lower across the board.
• Downbeat Euroone figures are limiting the Euro’s recovery.

The Euro is trimming some losses ahead of Wednesday’s US session opening, favoured by a mild US Dollar weakness after the US ADP report showed an unexpected decline in US employment.

US ADP confirms that US labor market is cooling

Job creation increased by 103,000 new payrolls in the US in. November, well below the 130,000 reading forecasted by the market. Apart from that, October’s reading has been revised down to 106,000 from the previously estimated 113,00.

These figures confirm that the impact of the restrictive interest rates is starting to hit the labour market. The impact on the pair however, has been subdued, with the Euro weighed by downbeat  German Factory orders and the contracting services activity data seen on Tuesday.

If the Nornfarm Payrolls report confirms this view on Friday, it will boost feeds speculation that the Fed might start curing rates in the first quarter of 2024 and increase negative pressure on the US Dollar.

The broader picture, however, remains little changed. The pair maintains a clear bearish bias, while below 1.0800 and 1.0850. On the downside, support levels are 1.0750 and 1.0660.

Technical levels to watch