EURUSD closed at its lowest level since November 2019 at 1.0943 after the US labor figures came in better than expected. According to the Bureau of Labor Statistics, there were 225,000 jobs added in January 2020. This was well more than what market participants had anticipated at 163,000.
However, a look at the other components of the labor report presented some problems. Average hourly earnings for the month only posted a 0.2% uptick which narrowly missed the 0.3% forecast. Meanwhile, the unemployment rate came in higher at 3.6% versus the consensus which was for it to remain steady at 3.5%.
Today, there are no top-tier data from both the US and the euro zone. This means that we could see a continuation of Friday’s price action or we could see the dollar give up some of its gains if investors pay attention to earnings and the unemployment rate.
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EURUSD Outlook
On the daily time frame, we can see that EURUSD looks poised to fall to its September 2019 lows around 1.0890. This price is the next near-term support level after the currency pair broke the floor at the 1.1000 handle.
However, if the dollar is unable to sustain its gains this week, EURUSD could retrace some of its gains back to the 38.2% Fib level (when you draw the Fibonacci retracement tool from the high of January 31 to today’s low). This area coincides with the currency pair’s previous lows and could this time around, offer EURUSD with resistance.
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