Thursday, 5 April 2018
EUR / USD – US Friday NON-FARM data in the market focus
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trading signals
The weakness of the European currency continued today. The data released today was not in favor of the euro. The volume of production orders in Germany grew by only 0.3%, with the expected 1.6%, PMI of the German service sector continued its decline from the previous 54.2 to 53.9, the same figure for the Eurozone also declined from 55.0 to 54 , 9 points. The decline is not so strong, but still these data significantly limit the demand for the European currency.
However, we believe that in recent days, European statistics do not have a strong impact on this market. So, quite strong data on European unemployment and inflation were ignored. Now the market has focused on US data and technical factors. First, yesterday's strong data by ADP suggests that tomorrow we will see strong numbers of NON-FARM. Strong data on the labor market for March will raise confidence that the US regulator will raise rates two or more times this year. This is a medium-term negative factor for the European currency, which will continue to put pressure on EUR / USD pair.
Now let’s discuss more important points of technical analysis, after the market broke through the middle level of this broad sideway range (1.2190-1.2510), the level of 1.23-1.2340, it is logical to assume that the decline will continue to the lower limit of the range. This is zone of 1.2240 and a further border in the area of 1.2190. So now, it's what is happening on the market. In general, it is logical to assume the relevance of entering longs from these levels. If not tomorrow's important data, capable of reversing the situation on the market.
Our trading recommendations concern how tomorrow the market will react to labor market data.
Trading recommendations- out of the market and wait for the release of NON-FARM data
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