The initial spike to the 1.0660/70 post-Payrolls has quickly fizzled out, leaving EUR/USD trading in the 1.0650 area as markets continue to digest the US docket.
EUR/USD upside capped at 1.0690/1.0700
Spot keeps meandering the daily range following mixed results from the US labour market during November, with market participants still adjusting to the unexpected contraction of Average Hourly Earnings, a proxy of wage inflation.
Other than that, the pair is managing well to keep the trade within the daily range, with the upside so far capped by the 1.0690/1.0700 band, where are located today’s top and the 23.6% Fibo of the November drop, all amidst a generalized softer tone around the buck.
EUR/USD stays on its way to close the second straight week with gains, although further upside appears unlikely in light of the underlying and unabated so far bullish stance of the dollar.
EUR/USD levels to watch
The pair is now losing 0.08% at 1.0650 facing the next support at 1.0515 (2016 low Nov.24) followed by 1.0457 (2015 low Mar.16) and then 1.0332 (monthly low January 2003). On the other hand, a break above 1.0690 (high Dec.2) would target 1.0700 (23.6% of the November drop) en route to 1.0820 (low Mar.10).