Forex News: After a brief period of sideways movement, yesterday the Euro bulls continued their climb and the assault on resistance reversed at 1.1210, a level better seen on a daily chart.
The pair shows strong rejection around 1.1210 zone, with both oscillators overbought and this suggests that today we will see bearish price action, at least to some extent. However, price was stuck in a range for a relatively long while and now it finally broke out so it’s possible for the current up move to extend into the zone near 1.1300. A lot of today’s direction will be decided by the U.S. employment data which will overshadow the technical aspect.
The Non-Farm Employment Change, which is the most important and anticipated report focused on United States employment is released today at 1:30 pm GMT. Analysts expect a hefty drop from last month’s 292K to 189K and if this prediction comes true, we are likely to see further upside movement for the pair, on the back of US Dollar weakness. This report usually creates very strong volatility, sometimes even sharp reversals or whipsaws, so caution is recommended.
The Bank of England kept interest rates unchanged but this time all members voted the same way, while previously, one of the nine voted to raise rates. This generated mixed movement at the time of the announcement.
The most recent candles show long wicks and the bullish momentum faded around 1.4650. On top of that, the oscillators are both overbought and all this makes us anticipate a move lower, which may find support at 1.4475. A break above 1.4650, followed by a re-test and bounce would make 1.4830 the next target but a lot will depend on today’s NFP release.
The United Kingdom didn’t schedule any economic indicators for the day but the U.S. Non-Farm Payrolls will directly influence the pair, potentially creating strong volatility.
We hope you had a profitable trading week and we wish you a relaxing weekend.