Market awaits NFP data: Euro/Dollar consolidates

June 7, 2024

By RoboForex Analytical Department

At the end of the week, the US dollar is hovering around an eight-week low against the euro, but trading activity remains subdued. Everyone is conserving energy ahead of this evening’s May employment data from the US. These reports are expected to provide more insight into the timing of the Federal Reserve’s monetary policy easing.

Yesterday, the European Central Bank lowered its interest rate by 25 basis points, from 4.50% to 4.25% per annum. The euro retained its daily gains. The ECB gave few indications about its future steps, and the market remains uncertain whether there will be further rate cuts. Persistent inflationary pressures dim the prospects for the ECB.

In its comments, the ECB mentioned that the consumer price index will remain above the target of 2% until the end of next year.

The market is preparing for relatively soft non-farm payroll (NFP) data from the US. The final figure may fall below the forecast of 185,000.

Investor expectations regarding the Federal Reserve’s decisions are constantly shifting. The market now predicts the first rate cut in September, followed by another in November.


Free Reports:

Download Our Metatrader 4 Indicators – Put Our Free MetaTrader 4 Custom Indicators on your charts when you join our Weekly Newsletter





Get our Weekly Commitment of Traders Reports - See where the biggest traders (Hedge Funds and Commercial Hedgers) are positioned in the futures markets on a weekly basis.





EUR/USD Technical Analysis

On the H4 chart, EUR/USD has formed an initial wave of decline to 1.0854 and a correction up to 1.0901. We expect the start of a new wave of decline to the level of 1.0833. A break below this level will open the potential for a wave down to 1.0760, with a trend continuation prospect to 1.0750. This first target of the decline wave is technically confirmed by the MACD indicator, whose signal line is at its peak and ready to continue descending.

On the H1 chart, EUR/USD is forming a consolidation range around 1.0882. An expansion of the range to 1.0908 is possible. After reaching this level, we will consider the likelihood of a new wave of decline to 1.0882. A break below this level will open the potential for a wave down to 1.0835, with a trend continuation prospect to 1.0765. This local target is technically confirmed by the Stochastic oscillator, whose signal line is below the level of 80. We expect a decline to the level of 20.

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

InvestMacro

Share
Published by
InvestMacro

Recent Posts

Silver Tarnished No More

Source: John Newell John Newell of John Newell & Associates answers the question: is silver…

5 hours ago

The push to restore semiconductor manufacturing faces a labor crisis − can the US train enough workers in time?

By Michael Moats, Missouri University of Science and Technology  Semiconductors power nearly every aspect of…

5 hours ago

China launches a plan to boost domestic consumption. Global trade tensions remain.

By JustMarkets Despite Friday’s good growth, US indices closed the week in negative territory. On…

9 hours ago

Escalating trade tensions triggered a risk reduction among investors

By JustMarkets  At the end of Thursday, the Dow Jones Index (US30) fell by 1.30%.…

3 days ago

Gold poised for record highs strong demand and stable outlook

By RoboForex Analytical Department  On Friday, the price of Gold surged to 2,983 USD per…

3 days ago

Week Ahead: USDJPY set for Wednesday showdown

By ForexTime  Yen expected to be one of the most volatile in G10 space vs…

3 days ago

This website uses cookies.