EUR/USD and USD/CAD await US unemployment data while EUR/GBP stays bid
Outlook on EUR/USD, EUR/GBP and USD/CAD ahead of US NFP data.
EUR/USD trades in near one-month lows ahead of US NFP data release
Ahead of Friday’s US non-farm fayroll (NFP) data, which is expected to show that the US economy added 200 thousand jobs in December 2022 after a 263 thousand rise in November, EUR/USD is trading in near one-month lows and may slide further towards the $1.0481 to $1.0444 mid-November high and early-December low.
Were this support zone to give way, the 55-day simple moving average (SMA) at $1.037 and the 200-day SMA at $1.0314 might be back in play. Only a bullish reversal and rise above Thursday’s $1.0631 high would have bullish connotations and may open the way for the mid- to late December highs at $1.0715 to $1.0736 to be revisited but this area represents good resistance.
EUR/GBP remains bid as UK house price growth slows
EUR/GBP’s recovery from this week’s £0.8783 low towards the October and late-December highs at £0.8867 to £0.8877 remains on track as the UK Halifax house price index shows the lowest growth since October 2019. The index increased 2% year-on-year (YoY) in December 2022, down from 4.6% in November. Compared to the previous month, house prices fell 1.5%, marking the fourth straight month of declines.
Only a rise and daily chart close above the December high at £0.8877 would put the minor psychological £0.90 region back on the plate. Intraday support sits at the £0.8828 November peak and more important support can be spotted along the two-month uptrend line at $0.881. Only a currently unexpected fall through Tuesday and Wednesday’s lows at £0.8783 and the £0.878 - 21 October high - may lead to the 55-day SMA at £0.8703 being back in sight.
USD/CAD recovery ongoing ahead of US unemployment data
USD/CAD’s early-January drop to C$1.347 has been followed by a recovery rally on Thursday on stronger-than-expected US ADP non-farm employment data which may act as a precursor to stronger US NFP data, out on Friday.
The USD/CAD cross is thus heading back up towards its October-to-January downtrend line at C$1.3669, above which the December and early-January highs can be spotted at C$1.3685 to C$1.3705. Immediate upside pressure should be maintained while Friday’s intraday low at C$1.3538 isn’t being slipped through, in which case the mid-December trough at C$1.3519 would be in sight. Further down sit the late-December and current January lows at C$1.3484 to C$1.347.
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