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EUR/USD: Traders await crucial US NFP release

  • EUR/USD market has turned indecisive, according to Thursday's Doji candle. 
  • US Nonfarm Payrolls are expected to show the economy added 164K jobs in December. 
  • An above-forecast US data could yield a bearish daily close. 

The EUR/USD market appears to have turned indecisive ahead of the US Nonfarm Payrolls report for December, scheduled for release at 13:30 GMT. 

The currency pair charted a Doji candle Thursday, as it witnessed two-way business and ended on a flat note. The Doji candle represents a lack of clear directional bias or indecision in the market place. 

Friday's close pivotal

A close below the Doji candle's low of 1.1093 would imply a continuation of the sell-off from recent highs above 1.1239 and open the doors for a drop to 1.1040 (Dec. 12 low). 

On the other hand, a close above the candle's high 1.1120 would confirm a bullish Doji reversal pattern. 

A bearish close could be seen if the US Nonfarm Payrolls disappoint expectations. The US economy is expected to have added 164K new jobs in December, after gaining 226K positions in November. The jobless rate is forecasted to remain unchanged at 3.5%, as well as the participation rate is foreseen at 63.2%. 

Meanwhile, Average Hourly Earnings are seen rising by 0.3% month-on-month and by 3.1% year-on-year, pretty much unchanged from the previous month.

"An upbeat report will likely trigger dollar gains across the board," according to FXStreet's Chief Analyst Valeria Bednarik. In that case, EUR/USD could end up printing a bearish close below 1.1093. 

However, in the case of a below-forecast NFP and wage growth figures, the euro will likely find takers, sending EUR/USD above 1.1120.

Technical levels

 

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