Since the beginning of this week, trading on major currency pairs is very active. The threat of a trade war continues to put pressure on the American currency. It should be recalled that the US president said that he planned to introduce additional duties on imports of steel and aluminum. Canada, the European Union, and China very negatively perceived the introduction of duties and stated that they could introduce their own protectionist measures. At the same time, investors' concerns weakened a bit after the US Congress expressed its negative attitude toward the introducing additional duties.
The key event this week will be the publication of the report on the US labor market for February, on Friday, March 9 (15:30 GMT+2:00). This statistic may have a significant impact on the dynamics and the further alignment of forces on major currencies. Recent reports from the US indicate the release of optimistic data on the labor market. In February, business activity in the manufacturing sector of the country increased by 2.9% to 60.8. The index of business activity in the non-production sector slowed slightly to 59.5. At the same time, the indicator exceeded market expectations at 58.9. Consumer confidence and consumer sentiment indices from the University of Michigan rose by 5.2% and 4.2%, respectively.
Experts expect that in February the number of people employed in the non-agricultural sector of the US will accelerate to 204,000. The unemployment rate will drop from 4.1% to 4.0%. The growth of the average hourly wage will remain at the same level of 0.3%. We recommend you to pay attention to the difference between the actual and the forecasted values of the indicators.
- The resistance zone – 1.2650-1.2550
- The support zone – 1.2000-1.2100
- The option balance level – 1.2325
At the moment, the technical pattern on the EUR/USD currency pair is ambiguous. The trading instrument is in a sideways trend. The EUR/USD quotes are testing the option balance level of 1.2325. The key trading range is 1.22600-1.23750. If the report on the US labor market is optimistic, the bearish sentiment may prevail on the EUR/USD currency pair. The movement is tending to 1.22600-1.21600.
Alternative option. If the price fixes above 1.23750, it is necessary to consider buying EUR/USD. The movement is tending to the round level of 1.25000.