EUR/USD: the volatility during the NFP data can give us good levels for new long positions

EUR/USD:

Our Expectations: Today it is more likely that the US NFP data to be above expectations. This might lead to a deeper correction as levels around 1,0960 will be proper for long positions with 50 pips stops after signals from Japanese candlesticks at lower time frames.

Alternative scenario: If data is below the expectations for 185 000 or the average earnings are disappointing this might lead to dollar depreciation and a breakthrough the current top.

Comments: 

Technical analyses show that the DeM Sequential has reached 9 and 13 as both criteria sequence signal a probable correction.

There is a probability for a Double Top formation as break below the zone between 1,1110 and 1,1076 will activate it. The breakout will also get the price back below in the channel which can increase the strength of the movement. If this formation reaches its first target this will be arounf 1,0960  where SMA50 and Fibo 38,2 are.

Above this level the long positions will be more rational and bulls might overcome.

Fundamentals are also in support of the EUR as the expectations for a change in course of the ECB monetary policy will strengthen, and on the other hand the probability for 2 more rate hikes in the US till the end of the year are already priced in.

Trader Nikolay Georgiev

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