EUR/USD bounces off 1.3850

FXStreet (Edinburgh) - The single currency is extending the rebound from 1.3850 on Friday, currently lifting the EUR/USD to the area of 1.3870/75.

EUR/USD buoyant despite unexpected Payrolls

February’s US Payrolls caught markets off guard today. The US economy added 175K jobs and left behind the 149K previously estimated, albeit the jobless rate up-ticked to 6.7%. The release triggered a quick (sharp-ish?) knee-jerk in spot to the mid 1.38s, although buyers re-emerged and are now pushing the EUR beyond 1.3870. James Knightley, Analyst at ING Bank NV, noted “with more people in work and these workers earning more money it should be good news for consumer spending and confidence and help cement expectations for ongoing Fed asset purchase tapering”.

EUR/USD levels to watch

At the moment the pair is up 0.07% at 1.3868 with the immediate resistance at 1.4000 (psychological level) followed by 1.4172 (high Oct.31 2011) and then 1.420 (high Oct.38 2011). On the flip side, a breakdown of 1.3721 (low Mar.6) would open the door to 1.3707 (low Mar.5) and finally 1.3694 (low Feb.28).