EUR/USD Forecast – Euro Plunges After Jobs Report
EUR/USD Forecast Video for 06.02.23
Euro vs US Dollar Technical Analysis
The Euro initially tried to rally during the trading session on Friday, but then plunged. The jobs number in the United States came out at 517,000 added last month, and therefore I think we have to look at this through the prism of whether or not inflation is going to go anywhere. Quite frankly, it’s not going to, and it seems as if there is a lot of distortion in the data. We could be looking at the beginning of something rather big to the downside, as the ECB looks to raise rates, but have already stated when they were going to stop.
Whether or not this causes a complete breakdown remains to be seen, but this certainly was a shot across the bow for the bulls. With this, it looks like almost everybody was on the wrong side of the market, and the reaction has clearly shown that to be the case. At this point, if we break down below the hammer from earlier in the week, that could send this market plunging, but I have learned over the years that the Non-Farm Payroll announcement is typically a very noisy affair, and we see the true reaction the following day. However, if we close at the end of the Friday session below that hammer, I think that’s an ominous sign and we probably go looking to the 1.06 level.
On the other hand, if we were to bounce, then we may just kind of hang around in a consolidation area, which is fine, because it just shows more of the same. Regardless, this is a market that I think is going to see more volatility, not less.
For a look at all of today’s economic events, check out our economic calendar.