EUR/USD - EUR/USD Forecast: Bears Coming Back! - 05/06/2016 (GMT)

An NFP with a headline print of +200k or more will indicate that the Federal Reserve does not need to worry too much about the U.S’s labor market conditions just yet. Therefore, for the greenback to rally on the NFP report, we need job growth to exceed 200k and it will be even better if it exceeds last month’s figure which is at 215k. Furthermore, average hourly earnings will need to rise by more than 0.2% or at least 0.3% which is the consensus. If any part of this equation is off, investors will be reluctant to buy dollars. Note that a ‘big’ miss either side of expectations will only heighten market volatility.
Technically, the levels to watch today will be: to the upside the 1.1455 – 1.1465 zone and to the downside the 1.1300 level, which is my target for today. This is a significant level since it coincides with the 50-SMA on the daily chart, as well as with the 23.6% Fibonacci retracement level. From there, I would wait for a pullback before it continues south, towards 1.1215 – 1.1230, which includes the ascending trend line which started back in mid-December 2015.