Selling EUR/USD Again As German Unemployment Increases
The German unemployment rate jumped higher, which might be anther negative data for the Euro as it holds the EBC back
The unemployment rate in Europe is not that important, but today’s German jobs report grabbed attention because of an unexpected increase in the unemployment rate to 5.3% from 5.0%. The number of unemployed rose by 133,000 compared to a decline of 6K expected.
What happened? Are layoffs starting? No. The German Federal Labor Agency reported that:
“These increases are due to the fact that the Ukrainian refugees are now being recorded in the job centers and are therefore visible in the labor market statistics.” This dynamic highlights additional jobs slack in the European labor market and could keep the ECB from hiking meaningfully above the current rate of 0% in the months ahead, especially if economic growth stumbles.
EUR/USD H1 Chart – The 20 SMA Has Turned into Resistance
Is the retrace higher complete?
EUR/USD has turned bearish again after the retrace higher which started by the middle of this month. The decline has been steep with the 20 SMA (gray) acting as resistance on the H1 chart. Today we are seeing a retrace higher in the US session after the new leg down during the European session which sent the price below 1.05. Although that area down there is a long term support zone and we have seen a decent bounce in the last few hours. But, the bounce might have come to an end and now the price is starting to reverse lower.
Germany June Unemployment Change
- June unemployment change +133k vs -6k expected
- May unemployment change was -4k
- Unemployment rate 5.3% vs 5.0% expected
- Previous rate was 5.0%
The German jobless rate unexpectedly climbed in June but as we said, the jump owes to a bit of a caveat, with Ukrainian refugees registering with the labour office in search of work. That saw the number of people out of work growing by 133,000 to 2.417 million. We decided to open a sell forex signal on EUR/USD as the price reached the 20 SMA.
EUR/USD Live Chart
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