- EUR/USD price printed an inverted cup & handle pattern.
- The US and EU economic divergence continued.
- The recent United States NFT numbers indicated a strong US labor market.
The EUR-USD remained stuck around the parity zone following the recent US NFP (non-farm payrolls) data. The pair hovers around value areas seen within the last few days. Also, it stayed beyond 0.9900 – the previous month’s low.
US NFP Data
EUR/USD price witnessed a consolidation period within the last few days as market players pondered the European and American economic performances. The latest events and data indicate that the Eurozone economy struggled due to the continued energy crisis.
Europe has seen gas prices more than doubling within the last few weeks as Russia squeezed the region. Russia has halted gas supplies to Europe, and economists worry that shipments might not restart soon.
This week’s data showed that Europe’s inflation jumped to record highs of 9.1%. Though oil prices plummeted broadly, the surging gas prices will see substantial cost upticks in most assets.
Moreover, the labor market will jeep tightening in the upcoming months. First and foremost, many firms have witnessed surging operation costs because of escalated gas prices. Also, companies have met operational challenges because of the drying Rhine River.
The US economy moved in a contrary direction. The numbers indicated that inflation started to fall as gar costs retreat. Moreover, the labor market remains substantially steady. This week’s data shows that vacancies soared rapidly within the last few months.
Furthermore, Friday’s non-farm payrolls data showed the economy added more than 315K jobs last month. That was higher than the 300K anticipated.
Wages surged 5.2%, whereas the unemployment rate increased briefly to 3.7%. Thus, the European Central Bank and the Federal Reserve will (possibly) keep diverging in the upcoming months.
EUR/USD Prediction
The 4hr chart shows EUR/USD remained in a constricted range within the last few weeks. The pair hovers within the crucial resistance of 1.0095 and support of 0.9950.
EUR-USD moved to the 25- and 50-day MAs, whereas the RSI (Relative Strength Index) moved sideways within the neutral mark. Also, the EUR-USD pair printed an inverted cup & handle setup. Thus, the currency can fall towards the support at 0.9850.