EURUSD Forecast: The Dollar Losses Its Mojo, Focus Shifts to NFP

Summary:
• The EURUSD trading pair has built an upward momentum signaling an impending upward breakout. Has the dollar come to the end of the road?

EURUSD stayed up on Thursday, rising by 0.1 percent marginally to trade at 1.1098. The US dollar is under pressure from the euro, following weak JOLTs jobs figures and forecast-beating German Factory Orders. The pair has gained momentum, with dollar holders hoping for impressive Non Farm Payrolls (NFP) numbers on Friday for a potential turnaround.

Germany, the Eurozone’s largest economy, reported on Thursday that its Factory Orders grew by 2.9 percent in July, beating analysts’ forecasts that averaged an average rate of decline of -1.6 percent. That will propel the EURUSD pair in the intervening period as the market awaits the release of US Purchasing Managers Index (PMI).

The world’s largest economy printed out lower-than-expected ISM and S&P Manufacturing PMI figures on Tuesday, and another miss in Thursday’s Services PMI readings could raise the pressure on the dollar.

US JOLTs Jobs Openings came in at 7.673 million, below the forecast figure of 8.090 million. That creates doubt over the US labour market, and raises prospects of soft NFP data on Friday. That said, the dollar has support from the higher-than-expected US Factory Order numbers in July, which grew by 5 percent against the forecast 4.7 percent.

EURUSD today

The EURUSD pair looks likely to maintain the upside momentum above the 1.1080 psychological mark. The price is above the middle Bollinger Band and is attempting to move to the upper band. The bullish view is further supported by the MACD indicator line which is above the signal line.

The 30-minute chart shows support for the upside view if the pair stays above 1.1090. The bullish momentum will likely encounter the first resistance at 1.1100, but extended control could enable a move above that mark to test 1.1112.

Conversely, a move below the 1.1090 pivot will shift control to the sellers, with the initial support likely at 1.1080. If the sellers extend their control, it could enable them to break below that mark, invalidating the upside view and strengthening the downward momentum to test 1.1071.