EUR/USD Mid-Session Technical Analysis for June 4, 2021

The Euro is trading steady against the U.S. Dollar on Friday ahead of the U.S. May employment report, which might give clues about when the Federal Reserve’s bond-buying tapering discussions would start.

According to a Reuters survey of economists, payrolls likely increased by 650,000 jobs last month after rising by only 266,000 in April.

At 12:14 GMT, the EUR/USD is trading 1.2116, down 0.0012 or -0.10%.

A larger-than-expected headline employment number could drive U.S. Treasury yields higher while supporting the U.S. Dollar and pressuring the Euro. A weaker-than-expected NFP number could trigger a small short-covering rally.

“A succession of strong sentiment surveys in the U.S. this week has revived fears of, still distant, Federal Reserve tightening,” ING analysts said.

“The only concern is a decline in employment components which, in our economics team view, heralds another disappointing job growth figure of 500K today,” they added.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. The trend turned down on Thursday when buyers took out the last main bottom at 1.2133. A trade through 1.2254 will change the main trend to up. It will be reaffirmed when buyers take out 1.2266.

The short-term range is 1.1986 to 1.2266. The EUR/USD is currently straddling its 50% level at 1.2125.

The second short-term range is 1.2052 to 1.2266. Its 50% level at 1.2159 is potential resistance.

The minor range is 1.2266 to 1.2104. Its 50% level at 1.2185 is another potential resistance level.

Daily Swing Chart Technical Forecast

The direction of the EUR/USD on Friday is likely to be determined by trader reaction to the pivot at 1.2125.

Bearish Scenario

A sustained move under 1.2125 will indicate the presence of sellers. This could trigger an acceleration to the downside with the next potential targets the main bottom at 1.2052 and the 50% level at 1.2027.

Bullish Scenario

A sustained move over 1.2125 will signal the presence of buyers. This could lead to a labored rally with potential upside targets coming in at 1.2159 and 1.2185. The latter is a potential trigger point for an acceleration into 1.2254 to 1.2266.