- EUR/USD extends bounce from previous cycle lows.
- US nonfarm payrolls increased by 372,000 jobs in June.
- The unemployment rate remained at 3.6%.
Despite the rebound from the lows, the selling interest around the single currency remains strong and motivates the EUR/USD keep price action subdued around 1.0100/15 at the end of the week.
EUR/USD continues to face a possible drop towards parity
EUR/USD remains negative on Friday after the release of non-farm payrolls showed the US economy added 372,000 jobs in June, beating initial estimates of a 268,000 job gain. May’s reading was revised lower to 384,000 (from 390,000).
The unemployment rate stood at 3.6% and the median hourly wage – a gauge of inflation through wages – rose 0.3% month-on-month and 5.1% from a year earlier. Additionally, the participation rate dropped slightly to 62.2%.
What to watch out for around the EUR
The bears are keeping EUR/USD under heavy pressure and the acceleration of the decline opens the door to a likely visit to the parity level sooner rather than later.
Indeed, the pair’s price action remains subdued, closely following growing speculation around a likely recession in the region, dollar dynamics, geopolitical concerns, fragmentation fears, and the Fed/Euro divergence. ECB.
Technical levels
For now, the pair is down 0.16% at 1.0140 and faces next contention at 1.0071 (Jul 8 low), followed by 1.0060 (Dec 11 2002 low) and finally 1.000 (psychological level). ). To the upside, breakout of 1.0538 (55-day SMA) would target 1.0615 (weekly high Jun 27) on the way to 1.0773 (monthly high Jun 9).
Source: Fx Street
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