• US Nonfarm Payrolls disappointed, but the Unemployment Rate improved.
  • Eurozone inflation hits the 5% threshold, higher than estimations.
  • EUR/USD Technical Outlook: The 1-hour chart depicts an upward bias, though a break above 1.1400 increases the opportunity of an attempt to the 100-DMA at 1.1500.

After a mixed than expected US employment report weakened the US dollar, the euro advances for the second time of the week. During the New York session, the EUR/USD is trading at 1.1346 at press time.

The market mood is risk-off as portrayed by European equity indices closing in the red, while US ones are losing, except for the Dow Jones Industrial (DJI) rising 0.34%. Also, the US 10-year Treasury yield printed a YTD high around 1.801%, failing to boost the greenback, with the US Dollar Index dropping 0.56%, sitting at 95.78.

US Nonfarm Payrolls report came mixed while Eurozone inflation reached the 5% threshold

Earlier in the North American session, the Bureau of Labor Statistics (BLS) released the US Nonfarm Payrolls report for December. The figures came shorter than expected, with the US economy adding 199K jobs, lower than the 400K foreseen by analysts. However, the Unemployment Rate improved, from 4.1% down to 3.9%, hitting a 22-month low.
December’s report was unlikely to reflect the impact of the fourth wave of the Covid-19, linked to the Omicron variant. The survey was done by mid-December, just as the newly discovered strain hit the US.

In the meantime, the Eurozone economic docket featured inflation figures. The HICP Flash for December on an annual basis rose by 5.0%, higher than the 4.7% estimated by analysts. The jump in the figure is attributed to high energy prices, rising 26%, compared to 2021. However, increases for food, services, and imported goods were also above the European Central Bank’s target of 2%.

EUR/USD Price Forecast: Technical outlook

Once macroeconomic data from the Eurozone and the US are on the rearview mirror, the EUR/USD pair stabilized around the 50-day moving average (DMA) at 1.1352. Given that the Relative Strength Index (RSI) is at 53 in bullish territory, the pair might print a leg up, but it would face strong resistance around December 31, 2021, daily high at 1.1386. A decisive break of that supply zone would send the pair towards 1.1400.

On the flip side, the EUR/USD first support is the January 5 high at 1.1346. A breach of the latter exposes the R1 daily pivot at 1.1325, immediately followed by a robust support area where ALL the hourly simple moving averages (SMAs) confluence with the daily pivot point around the 1.1308-16 region.

This article was originally published by Fxstreet.com.Read the original article here.

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