After Poor US Jobless Claims Data, EUR/USD Resumes the Uptrend

After Poor US Jobless Claims Data, EUR/USD Resumes the Uptrend

The dollar returned to a sell-off early in the US session after slightly worse-than-expected jobless claims data. European majors are usually mixed. European indices are still mixed, while US futures are showing only a slightly higher top. Trading can be relatively calm.

The publication of data on claims for unemployment benefits in the United States fell by 19 thousand to 793 thousand, but still exceeds the projected 755 thousand, so the dollar is moving down in all directions, and EURUSD is breaking up. Meanwhile, there is room for 1.2180, but keep in mind that every move up is followed by a correction, so don’t be surprised at the potential slowdown over the next few sessions.

Ideally, there will be retracement and the opportunity to join an uptrend. Keep in mind that the decline from the January high has occurred in three phases and this bullish trend has resumed, so further gains are expected as long as the market trades above the 1.1950 rejection level.

The number of initial claims for unemployment benefits in the United States for the week ended February 6 fell by -19,000 to 793,000, higher than expectations of 775,000. The four-week moving average of initial claims fell 33.5 thousand to 823 thousand. For the week ended January 30, the number of ongoing claims fell by -145 thousand to 4.545 thousand. The four-week moving average for ongoing claims fell -158k to 4,749k.
EUR/USD Uptrend Continues but Slowly
EUR/USD is pushing weekly highs but lacks momentum as the pair is still below the critical resistance area of ​​1.2170. The demand for the dollar remains weak after a soft statement from the Fed Powell and gloomy data on US employment.

“Satisfied comments by US Federal Reserve Chief Jerome Powell impacted investor sentiment late Wednesday night as he indicated that rates will remain at record lows until employment and inflation hit desired levels, which will take longer.

“The US just posted initial jobless claims for the week ending February 5, 793k worse than expected.”

The bulls will have a better chance if the pair breaks through the 1.2170/80 price zone. There will be no significant macro data releases on Friday in the European economic summary and the dollar market valuation is likely to continue to drive EUR/USD.

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Author : Azeez Mustapha

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Azeez Mustapha is an experienced author, trader, markets analyst, signals strategist, and funds-manager.