EUR/USD Outlook: Strong US Payrolls Keep Euro Under Pressure

The EUR/USD pair remains under sustained selling pressure despite temporary bullish liquidity sweeps earlier in the week. After sweeping liquidity above the 1.1270 resistance level, the euro experienced a sharp 80-point decline triggered by strong US labor market data. The US economy added 165,000 Nonfarm Payroll jobs, while the unemployment rate fell to 4.1%, with both figures significantly outperforming market expectations.

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From a technical perspective, bearish momentum remains fully intact. The primary zone of interest for sellers is Imbalance 24, which continues to act as key resistance. Until buyers invalidate Imbalance 24 and establish bullish structural patterns, the path of least resistance remains to the downside, rendering long positions risky in the current environment.

Fundamentally, the European currency has struggled to capitalize on potentially supportive domestic factors. Headline inflation in the European Union accelerated to 4.0%, reinforcing expectations for a third European Central Bank (ECB) interest rate hike in December. Additionally, recent US election results leading to a divided Congress have failed to weaken the US dollar, as markets continue to prioritize robust US economic performance.

While monetary policy tightening is underway across several central banks, market sensitivity varies considerably. For instance, the Bank of England's tightening cycle has provided underlying support for the British pound, whereas the euro has failed to react positively to hawkish ECB prospects. The Federal Reserve's stance, reinforced by resilient domestic data, continues to dominate broader foreign exchange flows.

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Key Support Levels and Forward Outlook

The broader multi-year trend structure suggests EUR/USD remains within a multi-month corrective phase following an eight-month fundamental shift in favor of the US dollar. However, immediate technical targets for sellers are focused on recent structural lows. Key support levels to monitor include the recent low of 1.1105 and the major low of 1.1066 established in June of last year.

Should the pair experience a renewed liquidity sweep below recent lows, a temporary corrective bounce toward Imbalance 24 remains possible before any further downside extension. Conversely, buyers would require a sustained upward impulse to invalidate current bearish setups and resume a broader recovery.

Looking ahead, the upcoming economic calendar is expected to provide little immediate volatility. The only noteworthy event scheduled for November 9 is Germany's Trade Balance report at 07:00 UTC, which is unlikely to alter prevailing market sentiment significantly.

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