Key Highlights
- The Euro started a fresh increase from the 1.1075 support against the US Dollar.
- EUR/USD surpassed a key bearish trend line at 1.1135 on the 4-hours chart.
- The US Nonfarm Payrolls increased 128K in Oct 2019, better than the 89K forecast.
- The Euro Zone Manufacturing PMI is likely to remain at 45.7 in Oct 2019.
EUR/USD Technical Analysis
This past week, the Euro started a strong upward move from the 1.1073 low against the US Dollar. EUR/USD gained bullish momentum and broke a few important hurdles near 1.1120 and 1.1140.
Looking at the 4-hours chart, the pair remained well bid above the 1.1050 pivot level, the 100 simple moving average (red, 4-hours), and the 200 simple moving average (green, 4-hours).
During the recent rise, the pair surpassed a key bearish trend line at 1.1135 on the same chart. It opened the doors for more gains above 1.1150, plus the 61.8% Fib retracement level of the downward move from the 1.1179 high to 1.1073 low.
On the upside, there are a few major resistances near the 1.1180 and 1.1200 levels. A successful break above the 1.1200 resistance could set the pace for more upsides in the near term.
Conversely, if there is a downside correction, an immediate support is near the 1.1140 level. However, the main support is near the 1.1110 level and a connecting bullish trend line on the same chart. Only a daily close below 1.1100 and the 100 SMA might push EUR/USD into a bearish zone.
Fundamentally, the US nonfarm payrolls report for Oct 2019 was released by the US Bureau of Labor Statistics. The market was looking for an increase of 89K in jobs, less than the last 136K.
However, the actual result was very positive, as the total nonfarm payroll employment rose by 128,000 in October. Moreover, the last reading was revised up from 136K to 180K.
The report added:
The unemployment rate was little changed at 3.6 percent, the U.S. Bureau of Labor Statistics reported today. Notable job gains occurred in food services and drinking places, social assistance, and financial activities.
Overall, EUR/USD might correct lower, but it is likely to climb higher as long as above 1.1100. Similarly, dips remain well supported in GBP/USD and AUD/USD.
Upcoming Economic Releases
- Germany’s Manufacturing PMI for Oct 2019 – Forecast 41.9, versus 41.9 previous.
- Euro Zone Manufacturing PMI Oct 2019 – Forecast 45.7, versus 45.7 previous.
- US Factory Orders Sep 2019 (MoM) – Forecast -0.3%, versus -0.1% previous.
