On the Forex currency market, another trading week ended on Friday, with the summing up of which we will begin today's review of EUR/USD. As you know, on the first Friday of each month, the US Department of Employment publishes data on the labor market. In the previous review of EUR/USD, it was noted that the expectations for the three main indicators are quite inflated, which means that it will be quite problematic to show values above the forecast ones. Let's take it in order. So, the unemployment rate last month was 5.9%, although the forecast assumed that its level would be at the value of 5.7%. Of course, such an indicator can be perceived as negative and it is expected that it will put pressure on the US dollar. If we touch on the growth of average hourly wages, the forecast was that they would grow by 0.4% in June. However, the actual figure was lower (at the level of 0.3%). Moreover, the previous indicator was revised from 0.5% to 0.4%. Thus, the data on wage growth also turned out to be weaker than expected and did not promise anything good for the dollar.
But the creation of new jobs in non-agricultural sectors of the American economy pleased investors. Let me remind you that the consensus forecast was that 690-700 thousand new jobs would be created in June. However, there were many more of them - as many as 850 thousand! Thus, we can conclude that the data on the labor market for June turned out to be very ambiguous. At a time when investors are waiting for strong indicators, to be optimistic about the earlier timing of the start of the Fed's tightening of its monetary policy. To summarize, only strong Nonfarm Payrolls were not enough for the US dollar to continue its strengthening over its main competitors.
Weekly
Despite weaker-than-expected reports on unemployment and wage growth, the US dollar managed to maintain its previously gained advantage in pair with the single European currency. However, the weekly trading ended extremely ambiguously. Let's figure it out. The last weekly candle has a black bearish body - this is an indisputable fact. But the long lower shadow and the closing price of 1.1865 suggest that the quote can continue moving in the south direction. It seems that the market is not yet ready to trade EUR/USD below the important technical level of 1.1800 or simply does not want to do it. An impressive lower shadow and the closing of weekly trading above the significant technical level of 1.1860 also indicate the likelihood of pursuing growth or trading in a relatively small price range.
In the reviews that were published last week, it was repeatedly noted that all the dots will be placed only after the publication of data on the US labor market and the closing of weekly trading, taking into account the actual indicators. It is exactly what happened, and the breakdown of the level of 1.1860 should be considered invalid. At the same time, there are also positive bearish moments for the pair on this timeframe, which include the completion of weekly trading under the blue 50 simple moving average, as well as within the Ichimoku indicator cloud. Now, judging by the weekly chart, about the near-term prospects for the price movement of the euro/dollar. To continue writing a downward scenario, the bears on the instrument simply need a true breakdown of the level of 1.1800. In fairness, it should be noted that even below this mark, there are strong technical levels that can return the pair above the 18th figure. Such levels can rightly be attributed to 1.1745 and 1.1700. However, so far, we are talking about 1.1800. In turn, euro bulls need to return a quote above 1.1900, and then pass up 1.1930 and 1.1960, where 50 MA passes.
Daily
If you remember, in Friday's review, the candle for July 1 was particularly noted, and there is a high probability that after the appearance of such candles, growth follows. Risky purchases were recommended after short-term declines to 1.1800. That's exactly what happened. This forecast was fully justified. The bullish candle for July 2 with a long lower shadow indicates a high probability of subsequent growth, especially since it was formed after a decline to 1.1800 and finding strong support. Now, to continue the rise, it is necessary to pass up the red Tenkan line, which passes at 1.1890, and then break through the 200-exponential moving average, colored orange on the chart.
Nevertheless, despite the results of Friday's trading and the formed candle, the main trading recommendation for EUR/USD is still sales. There are too many resistances at the top that euro bulls will need to overcome. I suggest taking a closer look at the sales near 1.1900, 1.1930, and 1.1970. In tomorrow's article, we will consider smaller time intervals and make necessary changes to today's trading recommendations. Moreover, if there are signals, we will indicate options for purchases.
