Stronger US economy pulling the EUR/USD string backwards & NZD in risk followed by dovish RBNZ report
- The upbeat US NFP report, intense wage growth rate and reduced unemployment rate is restraining EUR/USD rebound
- EUR/USD rebound erasing all of its previous day gains, currently residing at 1.1380 and further fall is anticipated as market bias remains in favor of USD
- NZD rebound in risk as well, as RBNZ remained dovish and made no change in its monetary policy or rate decision, as NZD is declining sharply looking towards erasing previous day gains
The recent NFP report has indicated that the USD is going to remain the sharpest currency of 2018, as US NFP report for October comes in much better than expected. US wage growth rate remains at its best since 2009 and US unemployment rate is also remained at its best since 1969. Overall, another hawkish rate hike is expected from the Fed in December. Fair and square, the market bias is turning against EUR, erasing all of its previous day gains. Eur is currently residing at 1.1380 and further fall is expected in the upcoming weeks.
EUR/USD 5 minutes chart
EUR/USD daily chart
As it could be observed in the chart, EUR was holding out well above 1.1440 region before the release of NFP data, yet it lost around 60 pips upon the release of NFP report. In addition, GBP has also lost nearly 70 pips after the release of US NFP report.
Apart from the GBP and EUR fallout, the NZD remains in real risk, as its rebound has stopped and it started to decline towards the its key support at 0.6550 region, followed by the release of recent RBNZ rate decision and no real intent was found to prevail its declining trajectory. If the current pace of USD continues to reign over the currency market and the next week’s mid-term US election turns out to be handy for USD, NZD could experience its worst run in 2018, falling behind the 0.6440 region. The same story also implies for Eur, as Eur outlook remains mixed, yet a sharp rise in USD would likely to cause a EUR fallout well below 1.1300 region, however, the key support for EUR remains at 1.1290 region.
Stay updated with latest Forex news here
[Disclaimer: The content of this article is personal opinion and should not be considered as investment advice or suggestion towards any trading activity.]