6 Sep 2013
EUR/USD bulls squashed further Thursday by dovish ECB and bullish US data
FXstreet.com (Barcelona) - The EUR/USD was slammed by the dovish commentary out of the ECB and net-bullish data out of the US Thursday. The damage was done by 15:00 GMT and the cross has been treading water ever since.
The ECB and data Thursday has passed; traders now eye US jobs report
The trading public should not have been caught off guard by the dovish comments out of the ECB Thursday – but based on the EUR/USD’s reaction Thursday, they were. Then, in the US session, we saw a list of data points that bulled up the DXY and added fuel to the downside fire for the EUR/USD:
o ADP Employment numbers came out just below expectations – slightly DXY-bearish
o Weekly jobless Claims came out lower-than-expected – slightly DY bullish
o Labor Costs came in lower-than-expected – DXY-bearish
o Productivity came in much higher than anticipated – DXY-bullish
o Factory orders declined less-than-expected – DXY-bullish
o ISM Non-Manufacturing data came in higher-than-expected – DXY-bullish
Friday, aside from some German Industrial Production numbers, all eyes will be trained on the US monthly employment report for further guidance on the direction of US rates and the DXY – and the EUR/USD.
Technical outlook for EUR/USD
Technicians say EUR/USD is absolutely broken and very oversold and that traders should be looking for rallies into which they can sell. The first resistance for the cross comes in at 1.3222. The downside target once this corrective rally tops out will be 1.30500 to 1.3100.
The ECB and data Thursday has passed; traders now eye US jobs report
The trading public should not have been caught off guard by the dovish comments out of the ECB Thursday – but based on the EUR/USD’s reaction Thursday, they were. Then, in the US session, we saw a list of data points that bulled up the DXY and added fuel to the downside fire for the EUR/USD:
o ADP Employment numbers came out just below expectations – slightly DXY-bearish
o Weekly jobless Claims came out lower-than-expected – slightly DY bullish
o Labor Costs came in lower-than-expected – DXY-bearish
o Productivity came in much higher than anticipated – DXY-bullish
o Factory orders declined less-than-expected – DXY-bullish
o ISM Non-Manufacturing data came in higher-than-expected – DXY-bullish
Friday, aside from some German Industrial Production numbers, all eyes will be trained on the US monthly employment report for further guidance on the direction of US rates and the DXY – and the EUR/USD.
Technical outlook for EUR/USD
Technicians say EUR/USD is absolutely broken and very oversold and that traders should be looking for rallies into which they can sell. The first resistance for the cross comes in at 1.3222. The downside target once this corrective rally tops out will be 1.30500 to 1.3100.