EUR/USD Mid-Session Technical Analysis for September 1, 2017

The EUR/USD is trading higher shortly ahead of the U.S. Non-Farm Payrolls report, due to be released at 1230 GMT. It is expected to show the economy added 180,000 jobs in August. The unemployment rate is expected to remain the same at 4.3% and Average Hourly Earnings are expected to increase 0.2%.

ISM Manufacturing PMI will be released at 1400 GMT. It is expected to come in at 56.5.

Any misses to the downside in the NFP report, especially average hourly earnings, will be bullish for the Euro.

The EUR/USD is likely to weaken if the headline number comes in north of 209,000, or if average hourly earnings increase by more than 0.2%.

Technical Analysis

The main trend is up according to the daily swing chart. However, momentum has been trending lower since the formation of the closing price reversal top at 1.2070 on August 29.

A trade through 1.1822 will indicate the selling is getting stronger. A move through 1.2070 will negate the closing price reversal top and signal a resumption of the uptrend.

The main range is 1.1661 to 1.2070. Its retracement zone at 1.1866 to 1.1817 stopped the selling on Thursday at 1.1822. This zone should be considered support.

The new short-term range is 1.2070 to 1.1822. Its retracement zone is 1.1946 to 1.1975. This zone is the primary upside target. Aggressive counter-trend sellers are going to try to stop this rally in an effort to form a secondary lower top. Trend traders are going to try to take out this area in an effort to make 1.1822 a new main bottom.

Forecast

Based on the early trade, the direction of the EUR/USD is likely to be determined by trader reaction to the uptrending angle at 1.1881.

A sustained move over 1.1881 will indicate the presence of buyers. This could lead to a test of the resistance cluster at 1.1946 to 1.1950. Counter-trend sellers may come in on a test of this area.

Overtaking 1.1950 could trigger a rally into the short-term Fibonacci level at 1.1975. This is followed by downtrending angles at 1.2010 and 1.2040.

A sustained move under 1.1881 will signal the presence of sellers. The next target is the main retracement zone at 1.1866 to 1.1817.

If 1.1817 fails as support then look for the selling to extend into at least 1.1771.