EURUSD Rallies After Italy Unemployment News

The Euro (EUR) inched higher against the US Dollar (USD) on Monday, increasing the price of EURUSD to more than 1.0500 amid some key economic news earlier today. The technical bias remains extremely bearish because of a lower low in the recent downside move.

Technical Analysis

As of this writing, the pair is being traded near 1.0558. A support may be seen around 1.0334, the low of January 2003 ahead of 1.0206, a key horizontal support area and then 1.0000, the landmark parity level where we expect a major buying interest. However, a break and daily closing below the parity line shall incite renewed selling interest, validating a move towards the 0.9613 support zone.

On the upside, the pair is expected to face a hurdle near 1.0600, the horizontal resistance ahead of 1.1610, a confluence of numerous resistance levels and then 1.1876, the low of June 2016 which shall act as critical resistance zone. The technical bias shall remain bearish as long as the 1.1610 resistance area is intact.

Italy Unemployment Rate

Italy’s unemployment rate rose to the highest level since June 2015, as the country struggles to regain a solid economic footing. The jobless rate was 11.9 percent in November, up from a revised 11.8 percent the month before, statistics agency Istat said Monday in Rome. The median estimate in a Bloomberg survey of 13 analysts called for 11.6 percent. Youth unemployment rose to 39.4 percent, the highest since October 2015. The November unemployment rate for the 19-nation euro area was 9.8 percent, the European Union’s statistics office in Luxembourg said later Monday.

Trade Idea

Considering the overall technical and fundamental outlook, selling the pair on short term rallies appears to be a good strategy for near term trading. 1.1876 (as mentioned before) could be a good selling point if we get a valid bearish reversal candle on the daily chart.

 

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