Although EUR/USD's reaction to today's U.S. jobs report was slightly bullish, protracted range trade is likely to persist.
November NFP, average hourly earnings m/m and average work-week hours all disappointed vs.
Additionally, there were downward revisions to October NFP and AHE results.
The misses should keep market expectations for pared-back Fed hikes intact.
This as fed funds futures are now pricing in under 35 basis points of Fed hikes into the end of 2019.
Additionally, in the wake of the data, U.S. Treasury yields remain heavy which has seen German-U.S.
spreads hit new tights for December.
These factors should help limit EUR/USD downside moves.
That said, longs are not without risks either.
The downside surprise to Germany's October industrial output bolsters views of slowing euro zone growth, which could lead the ECB to adopt a more cautious stance at next week's meeting.
Lingering bearish risks in the form of Brexit and Italy's budget negotiations should also help limit EUR/USD's upside potential.
Thus, while these factors persist, the broad 1.1200/1.1500 range is likely to prevail for quite some time.
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