Daily Market Recap – EURUSD Euro's fall resumes after US employment

The U.S. economy added only 210,000 jobs in November, the lowest figure since a decline of 306,000 jobs in December 2020 and well below market expectations of 550,000, as employers continued to report difficulties hiring and retaining employees amid a strong economic recovery.

However, the unemployment rate fell sharply from 4.6 percent to 4.2 percent, even as the labor force participation rate rose for the month to 61.8 percent, its highest level since March 2020.

Contrasting figures, therefore, but not weak enough to consider a change in tone from the Fed, whose members and its president this week made comments moving towards a more restrictive policy.

In Europe, the deteriorating health situation is a threat to the economy. German lawmakers put in place new restrictions yesterday for unvaccinated people and planned to vote to make vaccines mandatory.

National and regional leaders decided Thursday to ban the unvaccinated German population from all non-essential businesses, such as bars, restaurants, and movie theatres, in an effort to encourage vaccine uptake.

Other measures are also being put in place to try to stop the spread of the virus, including limiting the number of spectators at sporting events, additional testing for those vaccinated, and mandatory masks in schools.

These measures could affect consumer morale on Christmas Eve.

The euro's attempt to bounce back against the dollar failed at resistance at 1.1383. Tuesday's high wick heralded the return of sellers after a slight rebound. The trend remains bearish below the bearish oblique and below the 34-period descending moving average.

Traders could therefore make a move to test the support line on 1.1170 which had helped stabilize the fall of the euro in November. A break of this level could bring the European currency towards the psychological level of 1.10 or even the strong support zone around 1.08.

 (Chart Source: Tradingview 05.12.2021)

To invalidate this negative scenario, the euro-dollar must close above 1.1383 and then break free of the bearish oblique.

Support & Resistance Levels:

R3       1.1691

R2       1.1451

R1       1.1383

S1        1.1337

S2        1.1170

S3        1.1050

Disclaimer: This material has been created for information purposes only. All views expressed in this document are my own and do not necessarily represent the opinions of any entity.