The main for the entire trading week will be the data on the labor market of the United States of America. These indicators have always been perceived by market participants with special attention and reaction. Now, in difficult times of crisis, labor reports from the United States will once again demonstrate the pace of recovery of the world's largest economy from the negative consequences of the COVID-19 pandemic. Let's take a look at economists' forecasts for today's US labor releases. The unemployment rate is expected to remain at the same level of 6.3%, which looks very optimistic after falling from 6.7% a month earlier. If the unemployment rate coincides with the forecast value, the US dollar will receive support. But how strong it will be will become clear after the release of the actual figures, as well as two other important labor indicators.
The change in the number of people employed in non-agricultural sectors of the US economy, according to experts, should increase by 182 thousand, which, taking into account the previous rather low figure of 49 thousand, looks like a fairly sharp shift towards creating new jobs. The actual Nonfarm Payrolls indicator, which is close to the forecast, and even higher, will invariably increase the demand of market participants for the US currency. Finally, the growth of average hourly wages in February is projected at 0.2%, which means that economists expect the same wage growth that was observed a month earlier. This forecast should not be considered in any way exorbitantly high, on the contrary, 0.2% is a normal and average increase in wages in the United States of America. Given that the US dollar has recently shown strengthening across a wide range of the currency market, as well as not so inflated forecasts for the three most important labor reports, I am inclined to assume that the labor market data will not disappoint investors enough to radically change the situation and the technical picture for the main currency pair. Now let's look directly at the daily price chart of the euro/dollar currency pair.
Daily
As expected in yesterday's review, the pair's tendency to downward dynamics was fully confirmed. Everything happens exactly as expected. Yesterday's trading ended with the formation of a huge bearish candle with the closing price below the psychological level of 1.2000, namely, at 1.1968. The previously indicated assumption that the pair will then break through the support of 1.1952 is confirmed by the course of today's trading. At least at the end of this article, the euro/dollar is under quite strong selling pressure and is already trading near 1.1925, that is, significantly below the support level of 1.1952. However, the main events of today and the entire trading week are still ahead. It has happened more than once that Non-farm radically changed the market sentiment and the technical picture, so I think it is premature to draw any conclusions. We will do this on Monday, taking into account the actual closing of today and the entire week.
So far, we can conclude that the assumptions about the strengthening of the "American" are fully confirmed. In my personal opinion, for drastic changes to occur, the US labor market data should come out very weak and extremely disappointing. For those who are going to open new positions on EUR/USD today on the eve of Nonfarm Payrolls and the last day of weekly trading, I recommend that the main trading idea is to consider selling the pair after its short-term rebounds to the price zone of 1.1950-1.1990. If the fall continues without the indicated corrective pullbacks, it is better to wait with sales, since there are many strong technical levels at the bottom, each of which can support the pair and provoke an upward rebound. For those who want to buy the euro/dollar at lower prices, I recommend waiting for a decline in the strong price area of 1.1875-1.1825.
