The 20 SMA Rejects EUR/USD After US Jobless Claims Fall Below 200K
The 20 SMA, EUR/USD has been on a bearish trend since the beginning of summer, as US inflation surged above 5%. But the decline picked up pace in November as the FED turned more hawkish. FED’s chairman Powell commented about a faster pace of tapering which has already started, turning the USD even more bearish. EUR/USD fell below 1.12, but it has pulled above that level as it tries to put up a decent pullback higher.
Although, this doesn’t look like a decent retrace because we have seen selling pressure above 1.13 and now the 20 daily SMA (gray) is acting as resistance at the top, as soon as it caught up with the price. So, the selling pressure remains for EUR/USD son we are thinking about selling this forex pair. below is the unemployment report from the US.
- Weekly initial jobless claims 184K vs 215K expected
- Prior week was 222K
- Four-week average at 218.75K from 240K
- Continuing claims 1.992m vs 1.900m expected
- Prior continuing claims 1.954m
Two weeks ago, the 194K reading was the lowest since 1969 and now we’ve beaten it.
Here’s what Goldman Sachs says:
“The decline in initial claims appears to be explained by seasonal factors overstating pre-holiday layoffs, as initial claims rose by 64k to 281k on an NSA basis, their highest level since October.”