The EURUSD tagged the 1.2525 resistance handle for the second time ahead of Friday’s non-farm payrolls. It’s a level I mentioned on January 24 as the single currency was in the process of breaking above the 2008 crisis low at 1.2325.
Although the pair recovered from session lows on Friday, the 1.2525 resistance area is still holding. To the downside, we have the 2008 crisis low at 1.2325 which is now acting as support.
These two areas give us a 200 pip range to keep an eye on next week. Moreover, a daily close above 1.2525 or below 1.2325 would produce a range break opportunity.
A close above 1.2525 would target the next key resistance area at 1.2670. Alternatively, a daily close below 1.2325 would have us watching for a move lower toward the 1.2160 area.
If the uptrend since the start of 2017 is any indication, we should see buyers extend this rally over the next few weeks. At the time of this writing, I have no reason to believe that U.S. dollar weakness will subside over the longer term. But as always, I’ll let the market do the talking.
Keep in mind too that the single currency is trading above the weekly mean (10 and 20 EMAs) by about 400 pips. With this in mind, I wouldn’t be surprised to see some consolidation before the next leg higher can materialize.
I’ll cover the EURUSD again on Sunday before the market opens along with four other currency pairs. Until then, enjoy your time off.