Nov 04, 2022
VOT Research Desk
In the wake of another strong report from US Nonfarm Payrolls on Friday, EURUSD extends the daily upside to the 0.9810/15 band, or daily highs.
EURUSD briefly revisited the mid-0.9700s shortly after Nonfarm Payrolls showed the US economy added 261K jobs during October, exceeding initial estimates for a gain of 200K jobs.
The reading from September was increased to 315K. (from 263K).The Unemployment Rate increased slightly to 3.7% (from 3.5%) in the latest report, while the important Average Hourly Earnings—a gauge for inflation through wages—rose by 0.4% MoM and 4.7% from a year earlier.
In addition, the Participation Rate slightly decreased to 62.2%. (from 62.3).
The US dollar is still on the back foot while US rates continue their upward march despite the Federal Reserve’s tightening cycle being supported by positive payroll data. Despite the stronger-than-expected Payrolls for the month of October, the EURUSD is able to restore its composure and the 0.9800 level.
Price movement surrounding the euro is anticipated to closely track dollar trends, geopolitical tensions, and the Fed-ECB divergence in the interim.
The primary barrier to a long-term rebound in the pair is now the Fed’s recent decision to raise rates and the possibility of a tighter stance going forward (if it was any at all).
EUR/USD Technical levels
The current barrier for the pair, which is up 0.5% at 0.9794, is 0.9975 (weekly high November 2), followed by 1.0093 (monthly high October 27), and then 1.0197. (monthly high September 12).
On the other hand, if 0.9704 (the week’s low on October 21) were to be breached, 0.9631 (the month’s low on October 13) and 0.9535 would be the next targets (2022 low September 28).
