The US dollar drops strongly following the NFP, as US rates tumble.

The wider US dollar sustained major declines last week. As the Federal Reserve refused to provide guidance to traders on the timing of a further rate increase during this cycle. Poor-than-anticipated job market (NFP) & ISM service statistics in the United States fueled the dollar’s decline.  Sending bond rates in most maturity much lower. versus this context.  the EUR, GBP, and Australian dollar all rallied strongly versus the US dollar. At the same time, the yen finished the week almost at par with the USDJPY resting close to the 149.50 area.

 THE EUR VS US DOLLAR TECHNICAL ANALYSIS

After poor US economic data, the EURUSD erupted to the higher moving into weekend trading. Breaking over previous barrier in the 1.0670-1.0695 zone. Should the upside breakthrough continue in the following days of trading sessions. Investors may feel confident enough to target Fib barrier and the 200-day AMA around 1.0765. The concentration moves to 1.0840 mark as the intensity increases.

Should selling resurface and reclaim control of the market, first technical backing is located at 1.0695-1.0670 range. However, more loss may be in store if the price falls below this level, with the next negative target at 1.0550. Assuming moving trend line support near 1.0550 is breached, we could anticipate an advance towards this year’s minimums near 1.0450 level.

TECHNICAL STUDY OF THE GBPUSD

GBPUSD pair additionally extended out on Friday, breaking above trend line barrier near 1.2200 and its 50-day SMA. Which is placed near 1.2310 mark. The uptrend on GBP side, advances might increase in the following days of trading. Laying the groundwork for a likely rebound into 1.2450-1.2460. An important region wherein the 200-day SMA intersects with the 38.1 percent Fibonacci retrace of the July-October decline.

Should the purchasing enthusiasm decreases, allowing selling to mount to a reversal. The primary level of protection to watch is at 1.2320-1.2310. Preserving the technical threshold is critical; inability to accomplish so might lead to a drop near 1.2050 mark. If there are additional weaknesses, then may see a reversal headed towards the 1.1800 mark.

Support and Resistance levels

EURUSD

S3 1.04479 S2 1.04479 S1 1.04511 R1 1.07465 R2 1.08086 R3 1.12755

GBPUSD

S3 1.20368 S2 1.20368 S1 1.20368 R1 1.23891 R2 1.26422 R3 1.31418