The nerves of market participants are strained to the limit, and it has been impossible to be in this state for a long time now. Sooner or later, the nerves can't stand it and people will begin to behave inappropriately. What happened yesterday. The reaction of the market to the publication of US statistics was really absurd.
At the same time, oddities already began in the morning. As soon as the final data on the index of business activity in the manufacturing sector of Europe were published, which showed an increase from 39.4 to 47.4 with a forecast of 46.9, the single European currency immediately jumped. Which in general is a logical reaction. However, the euro did not last long. Just half an hour. After which it also promptly returned to the values that it had before the publication of the index of business activity in the manufacturing sector.
Manufacturing PMI (Europe):
But the most interesting thing happened when the ADP employment data was released. The dollar began to confidently lose its position, although the data themselves turned out to be much better than forecasts. It was expected that employment would grow by 3,000,000, but it turns out that it increased by 2,369,000. But the fact is that the results of the previous month were revised for the better, and instead of a decrease of 2,760,000, employment actually increased by 3,065,000 in May. So only the incredible nervous stress can explain the fact that market participants did not see a revision of previous data.
Employment change from ADP (United States):
Today will be a much busier day, so the market will be much more feverish. First in Europe, data on unemployment will be published, the level of which should grow from 7.3% to 7.7%. And this in itself is an extremely negative factor for the euro. The situation may be worsened by producer prices, whose decline rate should accelerate from -4.5% to -5.2%. So, the idea is that the euro needs to decline. However, it is likely that no reaction will follow, as market participants are waiting for the report of the United States Department of Labor.
Employment change from ADP (United States):
Today will be a much busier day, so the market will be much more feverish. First in Europe, data on unemployment will be published, the level of which should grow from 7.3% to 7.7%. And this in itself is an extremely negative factor for the euro. The situation may be worsened by producer prices, whose decline rate should accelerate from -4.5% to -5.2%. So, the idea is that the euro needs to decline. However, it is likely that no reaction will follow, as market participants are waiting for the report of the United States Department of Labor.
Unemployment rate (Europe):
The forecasts for the content of this very report are extremely positive. Thus, the unemployment rate should fall from 13.3% to 12.3%. In addition, 2,900,000 new jobs should be created. Of course, unemployment will remain at an incredibly high level. However, the trend itself indicates a gradual recovery of the labor market, which is a remarkable factor in the current conditions. And if market participants are not covered by another panic attack, the dollar will have to significantly strengthen its position.
Unemployment rate (United States):
From the point of view of technical analysis, we see a jump in speculative activity, where the area of 1.1180/1.1190 once again played the role of a pivot point, returning the quote to the limits of 1.1255-1.1275. The horizontal course is undeniable, but still the variable boundaries of the fluctuations are not the main platform in the existing development of the quotes.
It is worth considering that the area of 1.1180/1.1190 plays the main role of support, which means that the trading forces that are concentrated within it has a high indicator.
In terms of volatility, a high indicator is once again recorded, which exceeds the average daily level of activity.
Considering the trading schedule in general terms (daily period), you can see the process of slowing down relative to the specified clock from the area of 1.1400/1.1440.
We can assume that the quotes will slow down the upward movement within the values of 1.1275-1.1285, and short positions may appear against the background of the news flow, which will return us to the limits of the 1.1180/1.1190 area on the flow of speculation.
From the point of view of complex indicator analysis, we see that the indicators of technical instruments for minute and hour periods signal a purchase due to a local upward jump. The daily period took a neutral position.
