EURUSD Traders Look to Friday’s NFP as ECB Reaction Falls Flat

·    June 6, 2024

·      June 6, 2024

·    June 6, 2024

Thursday’s European Central Bank (ECB) rate decision and press conference failed to move the needle for the EURUSD, but traders don’t have to wait long for more volatility.

Watch today’s video for my thoughts on today’s post-ECB price action from the EURUSD and DXY, plus get my thoughts on Friday’s non-farm payroll (NFP).

The EURUSD rallied overnight ahead of Thursday’s ECB rate decision and press conference.

Unsurprisingly, those who chased the euro higher ahead of Lagarde’s comments are underwater, at least for now.

But what should traders make of today’s EURUSD price action?

After all, many were waiting for today’s ECB before committing one way or the other.

Unfortunately, the EURUSD hasn’t shown us much with the pair, mostly sideways, since Monday.

That said, I have a few observations about this week’s price action.

First, the EURUSD is holding above its 2021 trend line at 1.0860 on a daily closing basis.

We’ve yet to see a weekly close above this mark, but we do have three daily closes above it.

As long as the pair is above 1.0860 on a daily basis, shorting the EURUSD is risky if not ill-advised.

Second, the EURUSD dropped below its April 9th high at 1.0885, which is currently serving as resistance on the daily time frame.

If the pair can climb above that mark on the daily chart, we could see a continuation of this breakout toward 1.0925.

But as you can tell by these two offsetting factors, EURUSD traders are struggling to bring the pair to a resolution.

As for me, I would prefer to short a sustained break below 1.0860, as I know from experience that would trigger a high-conviction setup.

However, the DXY must reclaim 104.45 and 104.65 to confirm a EURUSD short.

Time will tell if that materializes or if euro bulls can follow through on Monday’s breakout.

Either way, traders may have to wait until Friday’s non-farm payroll before the euro is ready to signal its intent for next week.

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