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EUR/USD Current Price: 1.2126

• The US Federal Reserve announced it would start winding down its portfolio.
• Upbeat US data fueled demand for the greenback ahead of the Nonfarm Payrolls report.
• EUR/USD is bearish in the short-term, may accelerate its slump with an upbeat NFP.

The American dollar was the best performer this Thursday, soaring against all of its major rivals. The EUR/USD pair plummeted to 1.2119, its lowest since mid-May, initially weighed by the US Federal Reserve, as the central bank announced on Wednesday that it will begin winding down one of its programs set to support the economy throughout the pandemic. "Portfolio sales will be gradual and orderly and will aim to minimize the potential for any adverse impact on market functioning," the Fed said.

On Friday, the US will publish the May Nonfarm Payrolls report. The country is expected to have added 644K new jobs in May, while the unemployment rate is foreseen at 5.9% from 6.1% in the previous month. An upside surprise in those two numbers could further boost demand for the dollar as it will add pressure on the Fed to tighten its monetary policy.

EUR/USD Short-Term Technical Outlook

The EUR/USD pair trades near the mentioned daily low and has room to fall further. The 4-hour chart shows that, after meeting selling interest around a now bearish 20 SMA, the pair has broken below the 100 and 200 SMAs. Technical indicators reached oversold readings, paring their declines but holding nearby without signs of exhaustion. The immediate support comes now at 1.2115, with a break below it, probably resulting in an approach to the 1.2000 threshold.

Support levels: 1.2115 1.2070 1.2020

Resistance levels: 1.2160 1.2200 1.2245

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