EUR/USD Mid-Session Technical Analysis for December 8, 2017

The EUR/USD is trading lower shortly before the U.S. opening. The Euro is trading at its lowest level since November 21. Pressuring the Forex pair is the news of the passage of a bill to temporarily extend U.S. government funding, preventing a government shutdown on Saturday. This also helped raise optimism that a tax reform bill would also pass before Christmas.

EUR/USD traders were also awaiting the closely watched U.S. Non-Farm Payrolls report due to be released at 1330 GMT. It is expected to show the U.S. economy added 198,000 jobs in November. The unemployment rate is expected to come in unchanged at 4.1% and Average Hourly Earnings are expected to rise 0.3%.

Daily Technical Analysis

The main trend is down according to the daily swing chart. If today’s downside momentum continues, we could see a test of the November 21 bottom at 1.1712. Taking out this level will reaffirm the downtrend.

The EUR/USD is also rapidly approaching a major retracement zone at 1.1702 to 1.1610. An uptrending angle at 1.1668 passes through this zone, making it a valid downside target also.

On the upside, the resistance zone is 1.1823 to 1.1886. A downtrending angle at 1.1840 passes through this zone, making it a valid upside target.

Daily Technical Forecast

Based on the current price at 1.1734 and the intraday momentum, we’re looking for the selling pressure to extend into 1.1712 then 1.1702. Taking out 1.1702 could trigger an acceleration to the downside with the next target angle coming in at 1.1668.

Overcoming an uptrending angle at 1.1783 will signal the return of buyers. If this generates enough upside momentum, we could see a rally into 1.1823 then 1.1840. Overtaking 1.1840 could trigger an acceleration to the upside with 1.1886 the next target.