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  • EUR/USD sticks to the negative stance around the 1.1700 mark.
  • US Nonfarm Payrolls missed estimates at 661K in September.
  • US final U-Mich index next of relevance in the docket.

EUR/USD remains depressed and navigates the area of 2-day lows around the 1.1700 neighbourhood on Friday.

EUR/USD faces daily support near 1.1690

Despite the ongoing knee-jerk, EUR/USD is predicted to close the week with modest gains and recovering part of the ground lost during the previous’ week sharp pullback to the boundaries of 1.1600 the figure.

On the opposite side, the dominating risk aversion mood continues to bolster the positive performance of the greenback, particularly following earlier news that President Trump tested positive for COVID-19.

In the euro docket, EMU’s preliminary inflation figures noted the disinflationary pressure remains well and sound so far in the region. Indeed, the headline CPI is expected to gain 0.1% MoM and to contract 0.3% from a year earlier. The core CPI is seen advancing 0.2% inter-month and over the last twelve months.

In the US calendar, the US economy added 661K jobs during September, coming in short of forecasts (850K) and halving August’s nearly 1.5M jobs (revised higher). Additionally, the jobless rate ticked lower to 7.9% (from 8.4%).

What to look for around EUR

EUR/USD appears to have met a strong hurdle in the 1.1770/80 band so far, area coincident with the 55-day SMA and the immediate resistance line. The pair’s outlook still remains constructive and bearish moves are deemed as corrective only. Further out, the positive bias in the euro remains underpinned by auspicious results from domestic fundamentals (which have been in turn supporting further the view of a strong economic recovery after the slump in the activity during the spring), the so far calm US-China trade front and the steady – albeit vigilant- stance from the ECB. The solid position of the EMU’s current account coupled with the favourable positioning of the speculative community also lends support to the shared currency.

EUR/USD levels to watch

At the moment, the pair is retreating 0.33% at 1.1705 and faces immediate contention at 1.1612 (monthly low Sep.25) seconded by 1.1495 (monthly high Mar.9) and finally 1.1447 (50% Fibo of the 2017-2018 rally). On the upside, a break above 1.1769 (weekly high Oct.1) would target 1.1778 (55-day SMA) en route to 1.1917 (high Sep.10).