Key Highlights
The Euro traded as high as 1.2088 recently against the US Dollar before starting a correction.
There is a major bullish trend line forming with support at 1.2000 on the 4-hours chart of EUR/USD.
Downsides in the Euro remain supported around the 1.2000 and 1.1950 support levels.
The US NFP in December 2017 posted 148K, less than the market forecast of 190K.
EURUSD Technical Analysis
The Euro made a nice upside move this past week and traded above 1.2050. EUR/USD formed a high at 1.2088 and is currently correcting lower.
It tested the 23.6% Fib retracement level of the last wave from the 1.1817 low to 1.2088 high. On the downside, there is a major bullish trend line forming with support at 1.2000 on the 4-hours chart.
The trend line support is likely to act as a strong buy zone in the short term around 1.2000. Should there be a break below 1.2000, the pair could test the 50% Fib retracement level of the last wave from the 1.1817 low to 1.2088 high near 1.1950.
Therefore, it seems like there are a few crucial supports on the downside such as 1.2000 and 1.1950. On the upside, the recent high near 1.2080 is a resistance zone. A clear break above 1.2080 could push the pair further above 1.2100.
On the positive side, both 100 and 200 simple moving averages (4-hours) are at 1.1860-80 with an upside angle. Thus, the chances of more gains in EUR/USD are high once the current correction completes either near 1.2000 or 1.1950.
US NFP
This past week, the US saw the non-farm payrolls release for December 2017. The market was looking for an increase of 190K in jobs compared with the last 228K. However, the actual was on the lower side, as the NFP posted 148K.
On the other hand, the last reading was revised up from 228K to 252K. The unemployment rate remained at 4.1% in Dec 2017. Overall, the result was disappointing, which is why short-term downsides in EUR/USD will most likely find support.
