EUR/USD has gathered bullish momentum in the second half of the week. The US Bureau of Labor Statistics will release the May jobs report later in the day. EUR/USD – which has gathered bullish momentum in the second half of the week – could test 1.08 on disappointing US employment data, FXStreet’s Eren Sengezer reports.

Souring market mood could limit euro's upside in the near term

“A disappointing Nonfarm Payrolls (NFP) growth in May could put the dollar under strong selling pressure. It's worth noting, however, that wage inflation, as measured by the Average Hourly Earnings, is one of the key data points for the Fed when conducting its monetary policy. Strong wage growth could support the greenback even if the NFP falls short of estimates.”

“If safe-haven flows start dominating the markets in the second half of the day, EUR/USD could find it difficult to continue to push higher and vice versa.”

“In case EUR/USD rises above 1.0780, buyers could show interest and lift EUR/USD to 1.08 (psychological level) and 1.0830 (former support, static level).”

“1.0720 (50-period and 20-period SMAs on the four-hour chart) forms first support ahead of 1.07 (psychological level) and 1.0680 (Fibonacci 23.6% retracement).”

See – NFP Preview: Forecasts from 11 major banks, strength continues