EUR/USD Price Slumps Through Support Ahead of US Jobs Data, Chart Remains Weak
EUR/USD Price, News and Analysis:
- German industrial production data highlights economic weakness.
- EURUSD takes out support and eyes multi-month lows.
EUR/USD Price Rattled by More Weak German Economic Data
German industrial production fell heavily in December, missing pessimistic market expectations. On a month-on-month prices production crashed to -3.5% against expectations 0f -0.2% and 1.2% in November, while annual nsa and wda production hit -6.8%, compared to a forecast of -3.7% and a prior month’s -2.5%. These numbers continue this week’s trend of poor German and Euro-Zone data and question the recent view that the Euro-Zone economy has bottomed out and may be turning higher.
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The latest US Jobs report is released at 13:30 GMT today and if the US dollar gets a further boost, EUR/USD is primed to attempt a break through the double low made in August at 1.0941. The US dollar remains strong, and at multi-month highs, with expectations that a NFP print above market expectations of 160k, is likely, especially after Wednesday’s ADP release which showed private sector hiring at a 4year+ high.
While this week’s price action has been one-way, markets do have a habit of throwing a spanner in the works and any NFP print around the 160k-170k may disappoint the market and prompt USD profit-taking ahead of the weekend. While the short-to medium-term trend looks set in EUR/USD, the oversold nature of the market, using CCI, may support the pair for now. And if EUR/USD continues to move lower, expect US President Trump to up the ante on US-EU trade talks in the near future, or double-down on criticism of the Fed and the current ‘high’ levels of US interest rates.
EUR/USD Daily Price Chart (August – February 7, 2020)
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