At mid-day on Friday, at 12:30 GMT, the value of the US Dollar plummeted due to the release of the US monthly employment data. The EUR/USD surged by 60 base points or 0.50%.
The US data release consisted of three data sets, which each showed different results.
The US Average Hourly Earnings increased by 0.5% instead of the forecast 0.2%. The Unemployment Rate was at 5.8% instead of the forecast 5.9%. Both of these numbers, in theory, strengthened the value of the US Dollar, as a less unemployed population with larger salaries creates a larger domestic demand for the USD.
However, the US Non-Farm Employment Change came in lower than forecast. Namely, 559,000.00 people found jobs in the month instead of the expected 645,000.00. In the view of the market this outweighed the positive numbers, and a value adjustment of the USD down occurred.
Economic Calendar Analysis
On Thursday, the ECB Main Refinancing Rate and Monetary Policy Statement are set to be published. This event has moved the EUR/USD from 3.8 to 30.6 base points.
However, take into account that the initial reaction is usually muted to the Euro's central bank. Most volatility occurs during the ECB Press Conference's question part. The statement release is set for 11:45 GMT, and the Press Conference starts at 12:30 GMT.
Just as the ECB Press Conference starts, the US Consumer Price Index, US Core Consumer Price Index and the US Unemployment Claims are set to be released exactly at 12:30 GMT. Most likely, all USD asset and pair moves from 12:30 to 12:35 could be attributed to these data sets.
The rate has moved from 8.7 to 51.9 pips during the release of the CPI since January 2021, and 5.9 to 19.4 pips on the release of the US Unemployment claims since May 6.
Click on the link below to find out more about the data releases of this and other currency exchange rates.
EUR/USD hourly chart's review
In the aftermath of the surge, the rate paused before reaching the resistance of the 100 and 200-hour simple moving averages and the weekly simple pivot point in the 1.2190/1.2200 range.In the near term future, if the pair passes the resistance of the 1.2190/1.2200 zone, the pair could reach for the resistance of the May 25 and 26 high level and the weekly R1 simple pivot point at 1.2263.
On the other hand, a potential decline would look for support in the 55-hour simple moving average at 1.2165 and the 1.2160 level, which provided support in the second half of May.
Hourly Chart
EUR/USD daily chart's review
On the daily candle chart, the rate has passed the support line of the large scale channel up pattern, which guided the rate up since April.The rate could look for support in the daily simple moving averages, which are located in the range from 1.2040 to 1.1980.
Daily chart
Read More: Technical Analysis
Traders remain short
On Friday, on the Swiss Foreign Exchange trader open positions were short, as 59% of open position volume was in short positions.
In addition, trader set up pending orders in the 100-pip range around the pair were 53% to buy the pair.