Since the beginning of this week, trading on major currency pairs is very active. At the same time, a unidirectional trend is not observed. The dollar index (#DX) is testing two-week highs. In the near future technical correction is not excluded. Demand for risky assets resumed against the backdrop of a possible truce between Washington and Beijing.
At the moment, participants in financial markets took a wait-and-see attitude before publishing a report on the US labor market for March on Friday, April 5. These statistics can have a significant impact on the dynamics and further alignment of forces on majors.
Recent reports from the United States were rather weak. Preliminary data from ADP indicated an increase in the number of people employed in the non-agricultural sector of the country by 129K compared to market expectations of 184K. In March, the business activity index in the US non-manufacturing sector from ISM slowed down from 59.7 to 56.1. The consumer confidence index fell to 124.1, which was significantly lower than the forecasted value of 132.0.
Experts expect mixed data on the labor market: the number of people employed in the US non-farm sector will accelerate to 180,000; the growth of the average hourly wage will be 0.2% (m/m) in comparison to the previous value of 0.4% (m/m); the unemployment rate will remain at the same level of 3.8%. We recommend paying attention to the difference between the actual and forecasted values of the indicators.
Let's consider the current technical pattern on the EUR/USD currency pair.
- Support levels: 1.12150, 1.11850, 1.11500
- Resistance levels: 1.12500, 1.12850, 1.13250
- - the price is consolidating near 50 MA, which acts as a fairly strong dynamic resistance;
- - the MACD histogram is near the 0 mark.
At the moment, the EUR/USD currency pair is consolidating after a significant fall since mid-March. The technical pattern is ambiguous. The trading tool is testing local support and resistance levels: 1.12150 and 1.12500, respectively. Indicators do not send accurate signals:
We recommend opening positions from the key levels.
If statistics from the US turn out to be positive, we expect a further fall in the EUR/USD quotes. The movement is tending to 1.11500-1.11250.
An alternative could be the recovery of the EUR/USD currency pair to the round level of 1.13000.
Confirmations and entry points to the market should be looked for on lower timeframes. When tracking positions, we recommend using a trailing stop.
This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.Open Account