EUR/USD Mid-Session Technical Analysis for May 7, 2021
The EUR/USD is trading steady-to-better ahead of U.S. jobs data that is expected to point to a stronger post-pandemic economic recovery in the United States and to increase investor demand for riskier currencies.
U.S. payrolls data is due to be released at 12:30 GMT and is expected to show that employers hired nearly a million workers in April, as they rushed to meet a surge in demand unleashed by the reopening of the economy and massive financial help from the government.
At 11:47 GMT, the EUR/USD is trading 1.2072, up 0.0008 or +0.70%.
Traders know the estimates. The Fed know the forecasts. They may already know the number. But which way the EUR/USD will move after the release of the data will depend on how far above or how far below the guesses the number hits.
The Fed already told us the conditions needed to begin taking moves to change policy so a neutral to lower number won’t cut it.
A neutral or lower number will be supportive for the EUR/USD. A substantially well above the 990,000 forecast number may cap the Euro’s gains, but doesn’t necessary have to weaken it.
Daily Swing Chart Technical Analysis
The main trend is down according to the daily swing chart. A trade through 1.2150 will change the main trend to up. A move through 1.1986 will signal a resumption of the downtrend.
The minor range is 1.2150 to 1.1986. The EUR/USD is currently straddling its 50% level at 1.2068.
On the downside, the support is a retracement zone at 1.2038 to 1.1974. This is followed by a support cluster at 1.1976 to 1.1974 and another 50% level at 1.1927.
Daily Swing Chart Technical Forecast
The direction of the EUR/USD on Friday will likely be determined by trader reaction to the pivot at 1.2068.
Bullish Scenario
A sustained move over 1.2068 will indicate the presence of buyers. If this move creates enough upside momentum then look for the buying to possibly extend into the main top at 1.2150. This is a potential trigger point for an acceleration into the February 25 main top at 1.2243.
Bearish Scenario
A sustained move under 1.2068 will signal the presence of sellers. The first downside target is 1.2038. If this fails as support then look for the selling to possibly extend into a short-term cluster at 1.1986, 1.1976 and 1.1974.
If 1.1974 fails then prices could continue down into 1.1943 to 1.1927.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
