On Thursday, February 6, the euro was down at the close of trading. The single currency made an attempt at a recovery at the beginning of the European session, but was soon pegged back upon the release of underwhelming data on German factory orders. This suggests that the Eurozone economy remains in a weak position.
The American session saw further pressure applied, with the drop in the rate accelerating in the wake of the breakout at 1.0990. The fall of the EURUSD pair came to a stop at the 1.0965-mark. GBP also fell, this was attributed to the decline in the number of price quotes and also the favourable economic stats coming out of the USA. The number of Americans applying for unemployment benefits fell to a nine-month low last week, down to 202,000. This report is considered important ahead of today’s release of the Non-Farm Payrolls (NFP) data.
Today’s news (GMT+3):
The expectations we had for the American session did not materialise. Bears were stronger than anticipated, stopping any chance of a correction to the balance line. The 1.0990-1.0995 zone was a strong support from the daily timeframe. The rebound required to initiate the formation of a double bottom did not come to fruition.
At the time of writing, the euro is worth 1.0973. Traders are waiting for the release of the NFP report (16:30 Moscow time) and are also keeping an eye on any news that might come out of China. Investors remain cautious, worried by the growth in numbers of those infected and killed by coronavirus in China. According to the latest official data, 31,485 people are ill with the virus, 638 people have died, and 1,603 people have been successfully treated and discharged from hospital.
On days when NFP data is due to be released, we do not make forecasts.This is down to the fact that the indicator is highly unpredictable, the actual figures almost always deviate from the forecast by an average of 30-40,000. Here, we are referring to the mean average deviation from the predicted values. Deviations can sometimes reach 100,000, this is down to the fact that the indicators for the previous two-to-three months are constantly being reviewed and revised. In order for bulls to turn the tide, they need to push the price up to 1.1020 by the close. For bears, their payrolls target is 1.0920.