American NonFarm are usually published on Friday, that is, on the last trading day of the week. The importance of this release and the proximity of the weekend often lead to false price movements, creating the illusion of a trend reversal or large-scale correction. A similar situation occurred last Friday. The market was wary of the September figures of NonFarm, after which the EUR / USD pair reached the middle of the 15th figure. Traders were disappointed with the weak increase in the number of people employed in the non-agricultural sector and in the private sector, as well as a slight slowdown in wage growth. The fact of reducing unemployment in the United States to the 49-year low was ignored by the market, as was the upward revision of previous NonFarm indicators.

Of course, market participants expected stronger figures, especially after the excellent report from the ADP agency, according to which almost 230 thousand jobs were created in September. Having received a reason for the "sale" of the US currency, traders took profits in dollar pairs, triggering a sharp decline in the dollar index. But this price movement today has not received its continuation. Monday showed the restoration of the greenback in almost all pairs, including the euro-dollar pair. There are several reasons for this.

First, it is China. Today, it became known that the People's Bank of China decided once again (this time significantly by one percent) to reduce reserve requirements for the country's banking sector, providing the market with a liquidity of more than a trillion yuan. The Chinese stock market, "waking up" from a protracted celebration of Independence Day, fell by almost two percent, simultaneously playing back the negative events of the past week.

The decision of the Chinese Central Bank, by the way, the fourth in a row this year, says that Beijing is trying to level the negative effects of a trade war, which in turn indicates the existence of such consequences. Currency strategists and market makers have repeatedly voiced concerns about a possible slowdown in the Chinese economy and the subsequent slowdown in the global economy. Such steps of the People's Bank of China once again remind of this problem, so today's market reaction is rather emotional in terms of a general risk aversion.

The second reason for the growth of the dollar are the comments of representatives of the Fed. And although only a few days have passed since Friday, the voiced positions of some representatives of the regulator have returned to the market confidence in the "hawkish" position of the Fed. In particular, Raphael Bostic admitted that he was wrong in his predictions, since the real economic data exceeded his expectations. The current conditions, he said, require higher interest rates. Previously, he was taking a more neutral position, as was Bullard, who also noted "marked changes in a positive direction." The head of the Federal Reserve Bank of New York, John Williams, also spoke out with rather tough rhetoric. He assured the market that at the moment, there are no signs of threatening to reverse the yield curve, and therefore, the recession. He also stressed that the US tariff policy has not yet affected the dynamics of inflation or the labor market.

In other words, the Fed is very likely to ignore, or at least not focus on, the latest Nonfarm. The chances of a rate increase at the December meeting remained fairly high, especially in light of the recent speeches by Jerome Powell, who hinted at an acceleration in the pace of monetary tightening.

But the European currency continues to be under the yoke of Italian problems. Italy's Vice Prime Minister Matteo Salvini rejected criticism from the European Commission, taking a very tough position, calling the representatives of Brussels "enemies of his country." This suggests that a compromise on the level of the budget deficit for the next year has not been achieved, despite optimistic statements at the end of last week. On Friday, Rome agreed to lower the deficit bar when drawing up the budget for 2020 and 2021 (although it had previously planned to keep it at 2.4%), but flatly refused to revise the budget deficit level for the next year. In turn, Brussels criticized the proposal of the Italians. As a result, Italian stocks suffered significant losses, including in the banking sector. The yield on 10-year Italian bonds has grown today to a maximum of 5% per annum over 5 years. Such a fundamental background exerts strong pressure on the euro, and will apply until Rome and Brussels really come to a compromise.

From the point of view of technical analysis, the bulls of the EUR / USD pair, the main thing is to keep the price above the key mark of 1.1450, this is the bottom line of the Bollinger Bands indicator on the daily chart. Today, a preliminary test of this target failed. The bears were forced to retreat. But if the foundation continues to put pressure on EUR / USD, then overcoming this barrier will be only a matter of time. In this case, the path to a decline to the base of the 13th figure, that is, to the level of the annual minimum, will be opened. Resistance levels are the 1.1545 and 1.1580 price marks, the lower and upper lines of the Kumo cloud on the daily chart, respectively. If the pair consolidates above the top line of the cloud, the bear scenario will lose its relevance. However, at the moment, the fundamental background is not conducive to the implementation of such a scenario.