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02.10.202408:28 Forex Analysis & Reviews: Hot Forecast for EUR/USD on October 2, 2024

The preliminary estimate of euro area inflation showed a slowdown in the growth of consumer prices from 2.2% to 1.8%. Although the data fully matched forecasts, this report marked the beginning of the dollar's strengthening. However, it was primarily driven by U.S. macroeconomic data, particularly the JOLTS report, which showed not only 8.0 million job openings (against a forecast of 7.7 million) but also 3.1 million layoffs, compared to an expected 3.3 million. In other words, the situation in the U.S. labor market is somewhat better than expected. Consequently, the Federal Reserve has no grounds for another 50 basis point rate cut. However, today's ADP report could introduce some adjustments and potentially weaken the dollar. According to forecasts, employment is expected to grow by only 90,000, which is more than twice as low as what is needed to maintain labor market stability at least. Employment data holds much more weight than job openings and layoffs. The dollar may retreat to the levels it held before the release of the preliminary inflation data from the Eurozone.

Exchange Rates 02.10.2024 analysis

The stall at the peak of the upward trend ended with an active sell-off of euro positions, leading to the formation of a full-scale correction toward the upper zone of the psychological level of 1.1000/1.1050.

In the four-hour chart, the RSI technical tool is moving in the lower 30/50 area of the indicator, indicating increased interest in short positions on the market.

As for the Alligator indicator in the same time frame, the moving average lines (MA) are pointed downward, corresponding to the ongoing corrective cycle.

Expectations and Prospects

The speculative momentum favoring dollar positions still prevails in the financial markets. For this reason, a test of the 1.1000 level cannot be ruled out. Further development will depend on how the price behaves around this value. A partial recovery may occur if the volume of short positions on the euro decreases. However, if we see price stabilization below the 1.1000 level, a move toward the lower deviation of 1.0950 is possible.

*El análisis de mercado publicado aquí tiene la finalidad de incrementar su conocimiento, más no darle instrucciones para realizar una operación.

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