EUR/USD: Retest or Reversal? Navigating Technical Signals

EUR/USD: Retest or Reversal? Navigating Technical Signals Amidst Dollar Strength

The EUR/USD pair initiated the day with a bullish candle around the 1.0780 level, recovering from the earlier dip to the 1.0750 area during the early European session on Thursday. While technical buyers might express interest if the pair surpasses 1.0820, our technical analysis suggests that this could be a mere retest of the prior resistance before a potential new downward push.

Despite lackluster employment-related data releases from the US on Wednesday, the US Dollar persisted in outperforming its counterparts as investors leaned toward safer assets, steering clear of risk-sensitive options.

In November, employment in the US private sector increased by 103,000, falling short of the market's expectation of 130,000. Adding to the less-than-robust figures, Unit Labor Costs registered a 1.2% decline in the third quarter, deviating from the market's forecast of a 0.9% decrease.

Our outlook leans towards a bearish continuation for the EUR/USD. As the market processes the implications of the US economic data and global risk sentiment, traders are closely monitoring technical signals for potential trading opportunities. The delicate balance between economic indicators and market sentiment is poised to guide the path of the EUR/USD in the upcoming sessions.


Our preference

Short positions with targets at 1.0745 & 1.0720 in extension.