EUR/USD Stays Heavy as Tariff Concerns Overshadow Mixed U.S. Jobs Data
EUR/USD extended losses on Friday, falling to 1.0305 as risk sentiment soured following reports that President Trump is set to announce reciprocal tariffs. The pair initially swung in a wide range between 1.0414 and 1.0348 after a mixed U.S. non-farm payrolls report, which showed weaker-than-expected job creation but upward revisions to prior months and a lower-than-expected unemployment rate. Traders remained cautious, with buyers emerging near 1.0390 before sentiment turned bearish amid widening spreads, falling equities, and a USD/CNH rally. EUR/USD finished the session down 0.58%, highlighting ongoing downside risks.
Technically, EUR/USD remains bearish below key moving averages and the daily Ichimoku cloud base. The pair’s failure to hold above 1.0380 suggests continued downside pressure, with immediate support at 1.0320 and deeper support at 1.0305. A sustained break below these levels could expose the November low of 1.0250, with parity becoming a growing possibility if risk-off sentiment persists. Resistance is seen at 1.0390 and 1.0414, Friday’s high, with a move above the latter needed to signal a potential recovery.
The outlook for EUR/USD remains dependent on trade policy developments and U.S. labor market data. While the market is digesting mixed payrolls data, weekly jobless claims will provide a more frequent gauge of employment conditions. Should signs of slowing job growth emerge, the Fed may be forced into deeper rate cuts, narrowing the dollar’s yield advantage over the euro. However, if Trump’s tariff policies escalate, risk aversion and widening spreads could continue to weigh on EUR/USD, reinforcing its bearish trend.