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US employment data came in worse-than anticipated, weighing on the market’s mood while the ECB decided to increase its Pandemic Emergency Purchase Programme by €600 billion to support the economy. Valeria Bednarik, a Chief Analyst at FXStreet, notes EUR/USD is struggling at the 1.1260 level, preventing the pair to stretch the advance.

Key quotes

“The short-term picture maintains the risk skewed to the upside, as the pair continues to develop above a bullish 20 SMA, while technical indicators have resumed their advances after correcting overbought readings. Nevertheless, the 1.1260 price zone is a tough resistance area that the pair needs to clear to be able to extend its gains.”

“The ECB added €600 billion in QE. Lagarde acknowledged that the labour market is rapidly deteriorating and that the contraction is ‘significant,’ although she added that activity is expected to rebound in Q3. The GDP forecast for this year has been cut to -8.7%, while inflation was downwardly revised to 0.3% for this 2020.”

“In the US, job cuts announced by US-based employers totalled 397,016 in May, down 40.8% from April. Initial Jobless Claims for the week ended May 29 came in slightly worse than anticipated, printing at 1.87 million. More worrisome, the Continuing Jobless Claims for the week ended May 22 were up to 21.487 million.”