Downbeat US Jobs Data Send Euro Through Key Barriers

Technical analysis of Forex market

The Euro jumped to 2 1/2 month high at 1.1326 on Friday after disappointing US jobs data that further depressed the dollar. US NFP showed only 75K new jobs in May (the lowest since Feb) expectations for 185K and downward-revised April’s figure at 224K. The data came in line with signals from Wednesday’s ADP private sector jobs data (May 24K vs 180K f/c) which is often seen as indication for more significant NFP data. Average hourly earnings also disappointed in May (m/m 0.2% vs 0.3% f/c; y/y 3.1% vs 3.2% f/c), while unemployment rate remained unchanged at 3.6% in May. Downbeat data further weakened greenback’s sentiment, adding to rising expectations of Fed, following series of dovish comments from Fed officials earlier this week that could happen as early as next FOMC policy meeting on 19 June. Fresh advance surged through key obstacles at 1.1279/84 (daily cloud top/Fibo 38.2% of 1.1569/1.1107) and dented another pivotal barrier at 1.1318 (Fibo 61.8% of 1.1448/1.1107 downleg. Bulls need today close above here for confirmation that would open way towards falling 200SMA (1.1369). Strong bullish momentum supports the advance which is on track for eventual clear break above 1.1279/84 barriers after two consecutive failures. Broken daily cloud (1.1279) and 100SMA (1.1273) now reverted to supports and are expected to keep the downside protected and maintain bullish bias.

Res: 1.1326; 1.1338; 1.1369; 1.1393
Sup: 1.1279; 1.1273; 1.1251; 1.1215

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