EUR/USD: The profile remains bearish despite the prospect of a Fed pause – After trying to rebound last Thursday against better than expected European manufacturing PMIs, EUR/USD weakened again on Friday, against a seemingly strong NFP report, which supported the Dollar US.

Indeed, job creations came out at 339k against 180k expected, but the unemployment rate jumped from 3.5% to 3.7%, and hourly wages rose less than expected, at +0.3% in monthly data against 180k expected.

Faced with such data, expectations for the next Fed meeting remained anchored in favor of a pause. Indeed, the Fed barometer showed on Monday morning a 74.7% probability that the Fed would refrain from raising rates.

However, this does not seem to have been enough to support the Euro Dollar, which corrected sharply on Friday, and which remains under pressure on Monday, hesitating to stay above 1.07.

Regarding the next important events for the Euro Dollar, we will wait for the PMI indices of European services during the morning. In the US, the Services PMI will also be expected, along with Factory Orders, and the Services ISM.

Regarding the next meeting of the Fed, it will be recalled that officials have entered a period of no communication, in view of the FOMC meeting next week. We should therefore not expect any statement likely to influence expectations during the next sessions.

Technical thresholds to watch on EUR/USD

From a point of view chart, the context is still leaning further down on EUR/USD.

If the currency pair breaks below the 1.07 level, last week's low at 1.0635 and the 1.06 level will be the first potential supports. Then the 1.05 area, where the 200-day MA (1.0504) is and this year's low (1.0480) will be the next support.

On the upside, Friday's peak at 1.0780, the 1.08 round threshold and the 100-day MA at 1.0810 form the first significant resistance.

EUR/USD: The profile remains bearish despite the prospect of a Fed pause 1  

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