EUR/USD Mid-Session Technical Analysis for February 1, 2019

The Euro is trading higher shortly before the release of the U.S. Non-Farm Payrolls report at 13:30 GMT. The report is expected to show the economy added 165K non-farm jobs in January. The unemployment rate is expected to remain unchanged at 3.9%. Average hourly earnings are expected to come in at 0.3%, slightly below last month’s 0.4% gain. Some traders are saying the jobs data may have been distorted by the 35 day partial government shutdown.

At 11:05 GMT, the EUR/USD is trading 1.1468, up 0.0021 or +0.19%.

The current price action indicates investors are showing a muted reaction to data showing weakness in growth and inflation in the Euro Zone. The strength could be attributed to the dovish U.S. Federal Reserve. Weak U.S. jobs data should drive the EUR/USD higher.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. However, momentum is trending higher. A confirmation of yesterday’s closing price reversal top will shift momentum to the downside. A trade through 1.1435 will confirm the potentially bearish chart pattern.

A trade through 1.1514 will negate the closing price reversal top. The main trend will change to up on a move through 1.1570.

The minor trend is up. A trade through 1.1407 will change the minor trend to down. This will also indicate a shift in momentum to down.

The major resistance is the retracement zone at 1.1516 to 1.1587.

The EUR/USD is currently straddling the intermediate retracement zone at 1.1429 to 1.1463.

The short-term range is 1.1289 to 1.1514. If the closing price reversal top is confirmed then look for a possible test of its retracement zone at 1.1402 to 1.1375.

Daily Swing Chart Technical Forecast

Based on the early price action and the current price at 1.1468, the direction of the EUR/USD on Friday is likely to be determined by trader reaction to the Fibonacci level at 1.1463.

Bullish Scenario

A sustained move over 1.1463 will indicate the presence of buyers. If this move creates enough upside momentum, we could see a surge into 1.1514 to 1.1516. The latter is the trigger point for an acceleration to the upside with near-term targets coming in at 1.1570 to 1.1587.

Bearish Scenario

A sustained move under 1.1463 will signal the presence of sellers. This could lead to a labored break with targets lined up at 1.1429, 1.1407 and 1.1402.

Taking out 1.1407 will change the minor trend to down. This could create the momentum needed to challenge the short-term Fibonacci level at 1.1375.