EUR Trading Outlook (05-05-2014)

The AUD/USD: 0.9190-0.9200 been holding up strong, range trades still in play but for now the AUD need to break above 0.9320-30 area for a better uptrend confirmation. Risk events coming up this week for the pair, should the results be AUD bearish, the April low may break and the developing H&S top on daily charts is likely to be confirmed. The door may then open to a test of 0.8900-25 area.

EUR/USD: The EUR slipped below the 21-DMA and pierced the daily cloud top. A low of 1.3812 was made before the market took a deeper look into the jobs data. A big drop in the participation rate tarnished the US rate drop while the payroll data and lack of wage growth gave the market the sense the report wasn’t robust enough to seriously lift rates and the USD. EUR regained back above 21-DMA to a high of 1.3881 giving a better outlook for the next ECB announcement. The long lower wick on the daily candle and bullish engulfing on the weekly candle combine with rising day/week RSIs to suggest stops above 1.3906 and near 1.3930 are vulnerable.