Forex Technical Update
The US Non-Farm Payroll for the month of December 2011 came out better than expected 200K vs. 152K forecast, while the previous data was revised down from 120K to 100K. This was a positive and the market is reacting with USD-strength across the board. Or you can say that the positive data, which is giving the SP500 a rally by the way, is not giving the risk-on rally in the EUR/USD. Perhaps the correlation with USD and risk has broken when it comes to US data.
The EUR/USD is in a bearish continuation after pausing throughout the Asian and the first half of the European session. As we slide toward a support pivot near 1.26, we can look at 50-pip increments to whole numbers as possible support levels, so the next ones are 1.27 and 1.2650.
The weekly chart below shows the next support area near 1.26, established August-September 2010.
Fan Yang CMT is the Chief Technical Strategist FXTimes - provider of Forex News, Analysis, Education, Videos, Charts, and other trading resources