Forecast for EUR/USD on May 8, 2020

EUR/USD

On Thursday, investors decided to fix short-term profit on sales from May 4, the euro gained 42 points by the end of the day. The signal line of the Marlin oscillator almost touches the border with the growth territory, and whether the indicator will turn down or not from it, raises a big question, since US employment data for April is released in the evening. The forecast assumes an increase in unemployment from 4.4% to 16.0%, a reduction in the non-agricultural sector of about 22 million jobs. The intrigue is that investors have long been adapted to record poor performance, and therefore the reaction can be clearly expressed in a risk appetite. That is, they will begin to buy shares and sell dollars. The second part of the risk is that the risk appetite can also turn out to be short-term, purely speculative, because during periods of crisis, investors are guided by the speed of recovery of regional economies, and this option will be better for the United States, because there is stronger financial support for business and the market, and production and service enterprises begin to open.

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The correction may last until strong resistance from the coinciding lines of the price channel and MACD on the daily chart, in the price area of 1.0925. Furthermore, the market can focus on the consolidation range of 1.0770-1.1000, originating from April 6 (a gray rectangle in the chart). In this case, the price exit above the MACD line will be false and the price will return back to 1.0770.

There is also the option that the euro will fall with the release of US data as optimistically accepted by investors. This option is indicated by the probability of a reversal of the Marlin from the neutral level of 0.00.

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The price has already exceeded the MACD line on the four-hour chart, but the Marlin line can also turn around from the border with the growth territory. Leaving the price at yesterday's low of 1.0767 opens the way to the nearest target of 1.0595.

The material has been provided by InstaForex Company - www.instaforex.com