The bias remains positive on EUR/USD this Monday morning, as the currency pair continues to benefit from last week's positive news, which took it to a 2-month high of 1.0747.
Remember that last Wednesday's Fed meeting was less “hawkish” than expected, while Friday's NFP report came out well below expectations.
These two events have largely impacted market expectations for the next Fed meeting, with investors now estimating that there is no longer any chance that the Fed will raise its rates on December 13, whereas the perceived probability was more than 25% a week ago.
As a result, the dollar fell sharply, with a mechanically bullish impact on the price of EUR/USD.
Regarding important events for the Euro Dollar over the coming days, it should be noted that the economic calendar will be much less busy than last week, although a speech from Powell expected on Wednesday is likely to impact trade if the Fed boss surprises.
Technical thresholds to watch on EUR/USD
From a technical analysis point of view, the immediate bias of EUR/USD is bullish, as evidenced by the ascending channel visible since the beginning of October.
However, the currency pair arrives at the 1.0750 area, which could act as resistance , before another much more important obstacle in the 1.08 zone, where the 100 and 200 day MAs currently merge.
In other words, a correction could be the preferred scenario for the start of the week, in the absence of key statistics and facing major technical obstacles approaching.
If EUR/USD does indeed lose ground, 1.07 will be the first potential support , before the old resistance of 1.0635, then 1.06. On the upside, a break above 1.08 and the 100 and 200 day MA would put the 1.09 zone directly in sight.
EUR/USD remains well oriented but its upside potential could stay limited