- The triangle is seen as a bullish formation.
- Validating the breakout activates further growth.
- The US data brings high action later today.
The EUR/USD price continues to move sideways in the short term. The pair stands at 1.0889, and it awaits fresh momentum.
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The price changed little as the traders are waiting for the US data before taking action. Yesterday, it registered sharp movements after the US data dump.
The ADP Non-Farm Employment Change came in at 497K versus 226K expected and far above 267K in the previous reporting period.
The Unemployment Claims indicator was reported at 248K versus 247K forecasts, while ISM Services PMI jumped from 50.3 points to 53.9 points above 51.3 points expected.
In addition, JOLTS Job Openings and Trade Balance came in worse than expected, while Final Services PMI reported positive data.
Today, the US data should bring strong movements. The Non-Farm Employment Change is expected at 224K. The Unemployment Rate can drop to 3.6% from 3.7%, while Average Hourly Earnings could register a 0.3% growth again.
Positive US data should force the greenback to take the lead versus its rivals. In the short term, the currency pair could register sharp movements in both directions before developing a new swing higher or a leg down.
EUR/USD Price Technical Analysis: Bullish reversal
From the technical point of view, the EUR/USD pair corrective phase was stopped by the 1.0844 – 1.0835 area. Its failure to reach the 50% (1.0823) retracement level announced that the downside movement was over and that the buyers could take it higher again.
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The pair has retested the 38.2% (1.0868); it has passed above the downtrend line now. Validating the breakout from the current triangle should trigger an upwards movement. The current pattern is seen as a bullish formation.
Only invalidating the breakout and making a new lower low activates a larger drop. This scenario could take shape if the US reports better than expected data.
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