Ahead of the second round of the French elections, the JOLTS report and the US unemployment rate will be decisive for EUR/USD.
EUR/USD rebounds after the first round of the French legislative elections
The EUR/USD exchange rate has been surging since last night following the first round of the French legislative elections. Despite a landslide victory for the National Rally and the New Popular Front, the market seems to be reassured by the probable absence of an absolute majority for one of these “extreme” parties. However, we will have to wait until Tuesday, July 2, the deadline for candidates to apply or withdraw in the second round, to obtain more reliable projections based on surveys.
While waiting for the second round of elections next Sunday, traders will closely monitor the JOLTS employment report on Wednesday, then the US unemployment rate on Friday. The JOLTS report will be important for monitoring the evolution of the number of job offers in the United States, a data particularly monitored by Jerome Powell and considered “advanced” on the unemployment rate.
EUR/USD Daily Chart – Key Levels
EUR/USD could rise to $1.09 in the short term
From a technical analysis point of view, the CAC 40 is rebounding after consolidating for a few days at the lower limit of the symmetrical triangle in which it has been evolving for almost a year.
The risk/reward trade-off is back in favor of long strategies at the bottom of the triangle and the first major resistance to watch will be the May high at around $1.09. Disappointing US employment/unemployment figures would help EUR/USD bounce further.
On the other hand, the underlying outlook remains neutral within the symmetrical triangle. The exit from this triangle will set the tempo for the coming months.
| Entrée | Buy above $1.07 |
| Objective | 1,09$ |
| Stop | 1,0650$ |
| Risk/Return Ratio | >1 |
