EUR/USD bounces-back towards 1.2250 ahead of US NFP
- Benefits from a pause in USD rebound and risk-off in European equities.
- Focus shifts to the US jobs and Powell’s speech for the next direction.
The EUR/USD pair staged a solid comeback from the major trend line support at 1.2220, as the bulls cheered persisting risk-off trades on escalating global trade war angst, reflected by the sell-off in the European equities.
Russia and South Korea are now looking to raise tariffs on the US imports, following China’s retaliatory measures against the US tariffs and reports that Trump is considering additional tariffs on the Chinese products.
Moreover, fresh selling seen around the US dollar versus its major peers amid a risk-off tumble in Treasury yields also helped the spot to recover losses. All eyes now remain on the US payrolls release for fresh trading impetus on the EUR/USD pair.
Apart from the headline NFP print, average hourly earnings data is poised to take on increased importance. A sharper than expected increase in wages could revive hopes for a steeper Fed monetary policy tightening cycle and trigger a fresh leg of up-move for the buck,” Haresh Menghani, Analyst at FXStreet wrote.
EUR/USD levels to watch
According to Jim Langlands at FX Charts, “the Euro has fallen, to sit just above the major rising trend support at 1.2220, a break of which could then head towards Fibo support at 1.2170 and the 100 DMA at 1.2150. Below there would target 1.2085 and possibly 1.2025. On the topside, nearby resistance will be seen at 1.2260 and at the session high of 1.2290 ahead of the 4 Apr high of 1.2315, the 3 April high of 1.2335 and at the 2 Apr high at 1.2345. Further out, a stronger Euro would target 1.2370, 1.2420 and even1.2470, but seems unlikely for a while at least.”