Friday, 5 August 2022

[EUR] The Expected Giant Step after the Non-farm Payrolls 2022 0806

EUR/USD four-hour chart, source:FXDD.com



The reports from Gjallarhorn are produced by a trader, not by an analyst. The reports are provided to the investors showing the trader's view on the market.


Gjallarhorn has a short position of the euro in CME, now.


The currency pair EUR/USD plunged as the U.S. Non-farm payrolls was released on Friday. It still fluctuates in a channel though.


The pair has moved up and down in the sidling Bollinger Bands in the four-hour chart.


The sidling currency pair seems to accumulate the momentum, upward or downward.


The euro has raised its bottom gradually above the parity, 1.00 in the weekly chart. But the trend is bearish explicitly.


The dollar surged as the U.S. Non-farm payrolls rose more than doubling market expectation on Friday. The record better than the expectation supported the market to think of the Fed's tightening policies. The U.S. Treasury Yield soared this day, too.  


The Non-farm payrolls increased 528 thousands in July, which is double the market expectation, 258 thousand increasing.


The unemployment rate in July was 3.5 percent. It is below the market expectation, 3.6 percent.


Due to the records better than the expectation, the Dollar Index which tracks the greenback against the six peers rose 0.81 percent to 106.589. It rose 0.66 percent for a week.


The market expects the Fed's giant step in September, again. The probability of the giants step is evaluated 64.5 percent by the market according to the Fed Watch at Chicago Mercantile Exchange. 


As the greenback surged, the euro plunged against the dollar. Because the European Central Bank, ECB doesn't seem to hike the benchmark rate as the Fed did. The euro sank though the good German economy record.


The Federal Reserve has hiked the Federal Funds Rate 75bp to 2.5 percent in the previous month. It was the giant step as the markets expected. The FOMC hiked the benchmark rate 75bp twice in a row.

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