EURUSD: Pre-NFP Outlook


Sophia Todorova has a background in teaching and psychology, and as such relishes the idea of assisting new traders on their journey to Forex trading success. Technical Analysis is her passion. The charts speak, and she listens.

 

I cannot give a prediction of the Non-Farm Payrolls data due out today. I cannot even presume to interpret the market reaction to the news. I have come to realize that there seems to be more emotion in the market, particularly post-data, that it might be futile for me to place too much emphasis on trying to decipher the details. What I know for sure is that there is likely to be volatility in the market across the board…wild swings in both directions, that reveal that after the dust has settled, the technicals will probably prevail.

My technical analysis of Eurusd show the pair, although seemingly over-stretched, maintaining support and soaring in a gravity-defying fashion. As a follow-up to my previous article on this pair, following the breakout of the daily channel, 1.3930 has been exceeded, and a daily resistance line beckons at 1.4025. Beyond that, a weekly trendline is located at 1.4280s(See charts below). Should the current bullish momentum follow through, these are the levels I am watching as potential targets. Eurusd is at a point where we should be watching for a correction to take place, so I consider a buy at these levels to be very aggressive. However, I maintain my bullish stance until such a correction/reversal does in fact set up. As I am writing this, the 1-hour chart seems to have broken bullish out of a pennant, but without follow-through so far. To the downside, major support is likely to be found at 1.3840, a significant daily high that was breached.

During the news release and up to approximately 30 minutes after, participants will be trying to decipher the result, and so I will be sitting on the sidelines during this time. I do have trades on, with (hopefully) reasonable stops and targets in place. Best of luck, and stay safe!

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