Lowest Index of Non-farm Employment Changes in Five Years And Dollar

EUR/USD 1-hour chart, source: forexfactory.com

 The powerful index, U.S. non-farm employment changes recorded lowest in five years at 1200(GMT), announcing increase of 38,000. The market consensus was increase of 160 thousands. The bad result than market consensus affected the currency pair EUR/USD strongly. In the pair, Greenback plunged and Euro surged. Non-farm Index is one of the most effective events on foreign exchange market and it stimulated the momentum in the market.

And the other index of U.S. unemployment rate recorded 4.7 percent, lower than that of expectation. Participants forecasted 4.9 percent.

And I acknowledge my analysis was failed. I expected the weak Euro against U.S. Dollar by the double-tops pattern in one-hour chart and Euro is supported at 1.11 marked the bottom last month.

EUR/USD 4-hour chart, source: forexfactory.com

The moment of non-farm index spoken, Euro surged high. Not rising but also breaking through the downward line in a breath. By the experience, it may not return though the adjustment. If it keeps the downward trend, it may be step down inch by inch.

We need to watch the direction of greenback now. Since the global finance crisis, this bad news has provoked the strong Dollar. Participants concluded that only Dollar is believed. If such a result is announced, it was natural not Dollar's decline but Euro's diving.

Now we need to consider the another opportunity not just Dollar Long at unexpected economic index.

Pressure to Down Again, EURO

EUR/USD 1-hour chart, source: forexfactory.com

The major currency Euro falls against US Dollar. EUR/USD makes the typical turn-down pattern, double-tops pattern in 1-hour chart and it seems to keep its decline for a while.

In 4-hour chart, the price shows the adjustment after its rising. It has broken through the downward trend line already, it needs to watch whether the line acts the support line or not. But the feature of the Euro currency has shown that it doesn't fall rapidly and surge with rocket velocity, and there is the more possibility of falling under the downward trend line not overcoming.

Due to this adjustment in the four-hour chart, the resistance line was built at the price of 1.12 band. It seems there are some tries of break through the resistance line of 1.12. Once the line is broken through, the price band 1.12 may be a support line but the recent economic circumstance makes the price band the strong top, I guess.


Besides the technical analysis, we need to watch the news of ECB, European Central Bank's decision to freeze its Minimum Bid Rate at 1145(GMT), Thursday. ECB keeps its benchmark rate, zero percent to stimulate the Euro zone economy and it didn't destroy the market's expectation of freezing the rate. Therefore the currency pair EUR/USD rolled in a flash but it built the downward patter in one-hour chart. Though the event of the benchmark rate by the central bank is the most powerful affect to the its currency, but the fact of this event failed the impact makes the guess of bank's weaken influence on the market.

Meanwhile EUR/USD pair has checked its trough at 1.11. Though U.S. Fed raises Federal Fund Rate, it seems not to fall under price 1.11 except the temporary collapse.

In mid-term the price moves up and down between 1.11 and 1.12, I think.

EUR/USD 4-hour chart, source: forexfactory.com

Euro Rises to 1.1178, But Turns the Direction?

EUR/USD 4-Hour Chart, source: forexfactory.com

The major currency pair EUR/USD attempted the rebound since this week. And it rose to 1.1178 in London session. It broke through the short-term downward trend line made in early May.

But it is not uncertain it turned the trend, yet. U.S Dollar stood on the short position in London session against the major currencies such as Euro and Japanese Yen. The Sterling fell against greenback exceptionally.

In EUR/USD chart, it seems that the price of 1.12 comes into the resistance line. If the price broken through the trend line, breaks the resistance line 1.1200 again, the price may be on the upward line.

But FOMC is held on 14th to 15th in this month. The Fed hinted the raise of it bench mark rate. Till the speak of FOMC about the Federal Fund Rate, the price seems not to decide the its trend.

This story is read in http://cafe.naver.com/gjallarhorn/19, too.