- US job vacancies fell to 7.44 million, missing estimates of 7.98 million.
- US consumer confidence jumped to 108.7, well above forecasts of 99.5.
- The upcoming US presidential election is causing uncertainty.
The EUR/USD forecast shows a return of bullish momentum after a long decline. The greenback eased after employment figures in the previous session revealed unexpected weakness. At the same time, the uncertainty surrounding the US election has sent traders to the safe-haven gold.
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The US released mixed economic reports on Tuesday on consumer sentiment and employment. However, market participants focused on the employment figures since the Fed closely monitors the labor sector.
The JOLTs job openings report revealed that vacancies fell to 7.44 million, missing estimates of 7.98 million. The decline showed that there were fewer open positions for the unemployed, indicating weaker demand for labor. The soft figures solidified bets for a November Fed rate cut.
Meanwhile, consumer confidence jumped to 108.7, well above forecasts of 99.5. However, this was not enough to significantly shift the outlook for rate cuts.
Traders are on edge ahead of GDP and monthly employment figures that will show the state of the US economy. The nonfarm payrolls report will likely reveal an addition of 111,000 jobs in October, well below September’s job growth. A miss would raise fears of a weak labor sector, boosting Fed rate cut expectations. On the other hand, continued resilience might lower the chances of two rate cuts before the year ends.
At the same time, the upcoming US presidential election is causing uncertainty, sending traders to the sidelines. The race between Trump and Kamala is tight, meaning there is no certainty over the possible outcome. Consequently, market volatility will likely increase before, during, and after the voting.
EUR/USD key events today
- German preliminary CPI m/m
- US ADP nonfarm employment change
- US advance GDP q/q
EUR/USD technical forecast: Bullish RSI divergence
On the technical side, the EUR/USD price has made a new high above the 30-SMA, supporting a bullish bias. At the same time, the price trades above the SMA, and the RSI is in bullish territory above 50.
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The downtrend recently paused after the RSI made a bullish divergence. The weakness in the downtrend allowed bulls to take charge by breaking above the SMA. However, to solidify the new bias, the price must stay above the SMA and reach higher resistance levels like 1.0900.
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