EUR/USD Falls After US Labour Market Data
On Friday, key employment data from the US was released, which proved somewhat mixed.
On the one hand, the increase in jobs fell short of expectations. According to ForexFactory, the Non-Farm Employment Change figures were:
actual = 142K;
expected = 164K;
previous month = 89K.
On the other hand, the unemployment rate dropped from 4.3% to 4.2%.
Thus, the economic data showed that the US labour market is slowing down, but not at a rate that would raise significant concerns about US economic growth prospects (as it did after last month's reports).
Fridays release of US labour market news sparked volatility, and its impact is likely to be felt today, including on the EUR/USD rate.
On 29 August, we wrote that:
a bearish head and shoulders (H&S) pattern had formed on the chart;
the price broke through the rising trendline (shown in yellow);
the target for the decline could be the 1.10415 level.
Since then, the price reached the target (shown by the arrow) before reversing upwards. However, on Monday morning, the US dollar is strengthening against other currencies, with the EUR/USD rate dropping below Fridays low and signalling the possibility of another test of the 1.10415 level.
Technical analysis of the EUR/USD chart shows that the H&S pattern acted as a resistance zone on Friday, indicating that the bears are gaining confidence. It is possible that further strengthening of the US dollar could lead to the rate reaching the median line of the blue ascending channel.
Read more: https://fxopen.com/blog/en/oa-eur-usd-falls-after-us-labour-market-data/
Text source: Forex Trading Blog
