EUR/USD slid to a six-session low beneath the 10-day moving average on Friday after U.S. jobs data added to a euro-negative news flow that could lead to a test of 0.9500.
Solid September U.S. employment data nL1N3172NB left investors expecting the Fed to remain hawkish nL1N31813P and keep rates higher for longer, with futures markets pricing in a higher peak in borrowing costs EDH3, enhancing the dollar's yield advantage over the euro.
The payrolls report followed German import and export prices in August indicating inflation remains hot, which negatively impacted consumer spending and industrial output nL8N3181GL.
The data increases the probability of a euro zone recession, which could constrain the ECB's rate-hike intentions.
EUR/USD technicals highlight downside risks.
Daily and monthly RSIs imply downside momentum remains and EUR/USD trades below the falling 10-, 21- and 55-DMAs.
The U.S. and German data should give EUR/USD shorts a boost of confidence, increasing the chances of another test of support near 0.9500, a break of which would bring the 0.9000 area into focus.
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