- Summary:
- The US dollar caved in on Friday as weak Non Farm Payrolls figures and a rise in unemployment rate weighed in to spur EURUSD up.
EURUSD spiked on Friday, going up by 1.2 percent to trade at 1.0920. The gains saw the pair hit two-week highs of 1.0926, as traders reacted to weak US jobs data. It also brought an end to a two-week losing streak for the euro-with the dollar registering only two daily gains this week That underlines the strong bullish momentum around the euro on Friday.
US Non Farm Payrolls came in at 114,000 in July, below the forecast figure of 179,000. Also, the unemployment rate rose unexpectedly to 4.3 percent, exceeding analysts’ forecast of 4.1 percent. Afterward, the release of US Factory Orders added to the excruciating pressure on the greenback, declining by -3.3 percent versus the forecast decline of -2.7 percent. Furthermore, Average Hourly Earnings also missed forecasts, rising by 0.2 percent against a forecast rise of 0.3 percent. Meanwhile, the euro has support from a strong HCOB Eurozone Manufacturing PMI figures released on Thursday at 45.8 percent versus a forecast rate of 45.6.
EURUSD momentum signals further upside
EURUSD has risen steadily above the upper Bollinger Band, signaling a strong upside momentum, as indicated on the 2-hour chart. Also, the RSI indicator is at 74, underlining the strong bullish control. A stay above the 1.9000 psychological mark will likely sustain the upside momentum going into the weekend.
Support and resistance levels
On the 30-minute chart, the buyers look to stay in control if the EURUSD trading pair trades above 1.0899 pivot mark. The upside momentum will likely encounter the first resistance at 1.0921, but extended control by the bulls could lead to a break above that mark to test 1.0948. On the other hand, the sellers will take control if EURUSD falls below 1.0899. In that case, the first support will likely be at 1.0878. Nonetheless, extended control by the sellers could build a stronger downside momentum to breach that mark, invalidating the upside narrative and potentially going on to test 1.0854.
