EUR/USD Recovery Hinges on NFP Data and Fed Expectations

The Euro (EUR) staged a brief recovery against the US Dollar (USD) on Friday, rebounding from its four-day losing streak that saw it hit a fresh yearly low of 1.1215. However, the EUR/USD pair remains below the 20-day exponential moving average (EMA), indicating a bearish near-term tone.

The upcoming United States (US) Nonfarm Payrolls (NFP) data for September is expected to have a significant influence on Federal Reserve (Fed) interest rate expectations. The NFP report, scheduled for release at 12:30 GMT, is anticipated to show that the economy created 90K fresh jobs, lower than the 162K in August.

The US Dollar Index (DXY) has been trading cautiously ahead of the NFP data, currently sitting near 101.93 after hitting a fresh over-a-year high at 102.20 the previous day. The DXY is expected to continue its volatile trading as investors await the release of the NFP report.