Euro Shrugs as U.S. Posts Mixed Job Data
U.S. job numbers have been in uncharted territory in the wake of COVID-19. Nonfarm payrolls have shown huge moves – just two months ago, NFP plunged by a staggering 20 million jobs. However, the economy has shown signs of recovery, with gains in the past two releases. The economy produced a gain of 4.8 million jobs, easily beating the estimate of 3.03 million. There was more good news as the unemployment rate fell to 11.1%, down from 13.3% beforehand. Unemployment claims dipped to 1.42 million, higher than the estimate of 1.35 million. At the same time wage growth remains an area of concern, as wages continue to fall. The indicator declined by 1.2% in June, missing the forecast of -0.8 percent. This follows a decline of 1.0% in the May release. The mixed job figures did not make a mark on the forex market, and EUR/USD barely stirred in the North American session.
Eurozone PMIs Unlikely to Shake Up EUR/USD
On Friday, we’ll get a look at Services PMIs across the eurozone. The services sector has shown steady improvement, after being hammered in Q1 by the coronavirus, as the lockdown let to a shutdown of much of the sector. The Spanish, Italian and eurozone PMIs are projected in the mid-40s, which still indicates contraction but is not too far from the 50-level, which separates contraction from expansion. The French PMI is expected to nudge above the 50-level. On the manufacturing front, the final estimate for German PMI is expected to confirm the initial read of 45.8 points. Unless these estimates are well off the mark, the PMI releases are unlikely to stir up EUR/USD on Friday.
EUR/USD Fundamentals
Friday (July 4)
- 2:45 French Government Budget Balance
- 3:15 Spanish Services PMI. Estimate 46.0
- 3:45 Italian Services PMI. Estimate 46.9
- 3:15 French Final Services PMI. Estimate 50.3
- 3:55 German Final Manufacturing PMI. Estimate 45.8
- 4:00 Eurozone Final Services PMI. Estimate 47.3
*All release times are DST
*Key events are in bold
EUR/USD Technical
As can be seen in the above chart, EUR/USD pushed above the 1.1300 line in the Asian session, but was unable to consolidate these gains. The pair lost ground in the European and North American sessions.
- 1.1231 is fluid. Currently, it is an immediate resistance line
- 1.1134 is providing support
Further levels in both directions:
- Below: 1.1120, 1.1046 and 1.0950
- Above: 1.1212, 1.1300, 1.1434 and 1.1553