The EUR/USD did not continue its decline on Tuesday, as the rate found enough support in the lower trend line of a descending channel pattern to surge.
By the middle of Wednesday's trading session, the currency exchange rate had already pierced the resistance of the 55-hour simple moving average at 1.1213 and a monthly pivot point at 1.1220.
Due to that reason the rate was expected to reach the resistance of the 100-hour SMA at 1.1235.
The European Common Currency depreciated against the US Dollar, following the US Employment data set release on Friday at 12:30 GMT. The EUR/USD exchange currency rate lost 22 pips or 0.20% right after the release. The Euro continued trading at 1.1235 the level against the Greenback.
Bureau of Labor Statistics released the US ISM Non-Farm Employment Change data, which came out better-than-expected of 244K compared with the forecast of 162K.
According to the official release: "Notable job gains occurred in professional and business services, in health care, and in transportation and warehousing."
US data at the end of the week
This week the data that will impact the EUR/USD will come from the US. There are FOMC Meeting Minutes incoming and a couple of minor data releases.
The FOMC Meeting Minutes will come first, as they will be published at 18:00 GMT on Wednesday. The event has caused moves on the EUR/USD from 6.7 to 28.1 pips since November 2018.
On Thursday, the US CPI and Core CPI data will be published at 12:30 GMT. The data release has caused moves from 13.3 to 28.1 pips since February.
On Friday, the US Producers Price Index will be released at 12:30 GMT. The event has caused moves from 5.3 to 40.4 pips. Although, note that the 40.4 pip move was actually caused by other announcements being made at the same time as the PPI was published.
For more information watch this week's Economic Calendar Analysis
EUR/USD hourly chart's review
Yesterday, the EUR/USD currency pair traded sideways between the Fibonacci 38.20% and the monthly S1, located at 1.1200 and 1.1220 respectively. During Wednesday's morning, the pair was trading within the given cluster.Note, that the exchange rate is supported by the 55-hour moving average, currently located at 1.1213. Thus, it is likely, that some upside potential could prevail in the market. However, note, that the rate has to surpass the 100-hour SMA at 1.1236.
If the given resistance holds, it is expected, that a reversal south could occur in the nearest future. It is unlikely, that the pair could drop lower than the given Fibonacci retracement.
Hourly Chart
On the daily candle chart, the pair has broken the support of the ascending channel pattern. The move occurred due to the pattern already ending its work, as both trend lines of the pattern had changed the direction of the rate three times.
In the meantime, an additional pattern was added. The broken channel is junior to the most recently added one.
In accordance with the current patterns, the rate should decline down to the 1.1170 level, where the lower trend line of the added pattern is located at.
Daily chart
Since the middle of Monday's London trading, on the Swiss Foreign Exchange 74% of open EUR/USD position volume was in short positions.
On Wednesday, the sentiment became 71% short, as some traders closed their positions during the surge and some opened short term long positions.
Meanwhile, today, trader set up pending orders in 100-pip range around the pair were almost neutral, as 53% of all orders were set to sell and 47% were to buy.