EURUSD pressures top of thick daily cloud after post-ECB sharp fall; US jobs data in focus
The Euro is trading within narrow consolidation on Friday after suffering heavy losses on 0.8% fall on Thursday, which marks the biggest one-day loss since 07 Feb.
The single currency came under strong pressure from remarks of ECB President Mario Draghi in the press conference after central bank’s policy meeting.
The ECB left interest rates unchanged as expected but Draghi pointed at underlying inflation which remains subdued and marks the main obstacle for the central bank to start tightening the policy, despite strong economic growth.
Focus turns today at US jobs data, due later today, for fresh signals about the strength of the US labor market, after release on Thursday showed weekly jobless claims increased more than expected last week.
US Non-Farm payrolls are forecasted at 200K, signaling unchanged number of new jobs from the previous month, but the figure is considered as strong and expected to send unemployment to multi-year low at 4.0%, from 4.1% in January.
Another closely watched indicator, average earnings, is expected to slow in February after strong increases in past three-months (Feb f/c 0.2% vs 0.3% in Jan).
Solid numbers from today’s jobs report is expected to generate further signals of economy strength and boost expectations for Fed’s more aggressive approach to interest rates in 2018.
Strong fall on Thursday weakened the structure and shifted near-term focus lower, as Thursday’s long bearish daily candle weighs and fresh bears pressure key near-term support at 1.2285 (top of thick daily cloud), as rising cloud strongly underpinned recovery rally from 1.2154 (01 Mar trough).
Bears may have difficulties to break into daily cloud which marks strong support and today’s close in relation to cloud would be the key signal for the near-term action.
Firm break into cloud would be bearish signal for extension of pullback from 1.2445 double-top, while stronger hesitation above cloud top would signal prolonged consolidation and possible stronger upticks.
Res: 1.2321; 1.2334; 1.2354; 1.2400
Sup: 1.2285; 1.2265; 1.2223; 1.2187