EURUSD technical outlook into NFP: Decisive day for USD


The Fed officials in one voice are saying today’s NFP releases may be decisive for the USD. Nevertheless, the probability of early interest rate increase is possible only if the economy shows full-fledged growth. Let’s look at our EURUSD technical outlook into NFP data.

2 SeptemberAtoZForex – Today’s main economic event for the dollar will be the publication of the Nonfarm Payrolls (NFP) by the US Department of Labor. This release will determine the EURUSD trend for the next few days. An optimistic index will return confidence that the interest rate may be raised in the autumn. If the NFP figure will be lower than forecast, the dollar will show a significant decrease, as the raising of interest rate is likely to be delayed until the end of this year.

Regarding actual trading day – The European currency has been declining again. Another wave of demand for USD prompted by pressure on risky assets. In addition, against the euro played the fundamental data from Eurozone.

EURUSD technical outlook into NFP

EURUSD technical outlook in NFP EURUSD technical outlook into NFP (click to zoom in)

From today’s EURUSD technical outlook into NFP we can see that:

  • The pair is trading between the 50, 100 and 200 Simple Moving averages. As we see from 4-hour EURUSD chart, 200 SMA plays a role here as support line at 1.1600. However, Moving averages are not giving any clear signal.
  • The MACD histogram is still in the negative zone, but above its signal line, continues to rise gradually and gives a signal to buy EURO.
  • The RSI is directed downward, thus gives a sell signal.
  • Stochastic Oscillator is in the overbought zone and gives a signal to short as the% K falls below the% B.

Due to a contradiction in signals which are given by indicators, we believe that it would be better to wait for completion of consolidation. The bulls will dominate in a case of the breakthrough at 1.1230 level, wise verse downtrend will continue.

Additionally, today’s publication of the Nonfarm Payrolls which is likely to create volatility to some extent. Thus traders should follow the fundamental developments to avoid any possibly sour situation.

Also see: 2 MA trading strategy NFP Forex analysis

Think we missed something? Let us know in the comments section below.

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