(News Bulletin 247) – The euro continued its downward movement, in the form at this stage of a pullback on the long moving average, against a background of heating of 10-year Treasuries, the yields of 10-year American sovereign bonds. This very relevant barometer for who works the currency pair, saw its needle move from the end of last week and the content of the NFP report, which highlighted job creations of more than 500,000 in the private sector and an equally surprising drop in the unemployment rate to 3.4% of the working population. Persistent tensions on employment which militates for a downward inflection of the Fed Funds for 2024, and not at the end of 2023.
Fears of a runaway price and wage spiral have not yet been formally ruled out, and there is no doubt that J Powell will speak on the issue this evening (6:00 p.m., Paris time), on the occasion of an event organized by the Economic Club of Washington, DC
The Fed rightly signaled its mistrust of tensions over employment after the FOMC last week, auguring further rate hikes, after the Fed Funds hike of 25 bps on Wednesday. This “signals further increases to counter the risks posed by tight labor markets. continues even if the phenomenon is slow”, analyzes Jeanne Asseraf-Bitton, Head of Research and Strategy at BFT IM.
At midday on the foreign exchange market, the Euro was trading against $1.0705 approximately.
KEY GRAPHIC ELEMENTS
The bullish bias is not threatened at this stage. Simply, the spot retreats, in the direction of its long moving average, without any tangible sign of a buying entry point. Neutral opinion retained.
MEDIUM TERM FORECAST
In view of the key graphic factors that we have mentioned, our opinion is neutral in the medium term on the Euro Dollar (EURUSD).
We will maintain this neutral opinion as long as the Euro Dollar (EURUSD) parity prices are positioned between the support at 1.0645 USD and the resistance at 1.1190 USD.
CHART IN DAILY DATA
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