EUR/USD Declines as US Dollar Strengthens Ahead of ADP Jobs Data

EUR/USD Slides Below 1.1750 as US Dollar Recovers Strength

The EUR/USD currency pair continued its downward trajectory on Wednesday, slipping below 1.1750, as US Dollar (USD) strength gains momentum ahead of the ADP Employment Change report. The pair rejected gains near 1.1800 and remains under pressure as a mixed batch of economic indicators steers the market narrative.

Dovish Powell and Strong US Jobs Data Support USD

The US Dollar Index (DXY) staged a rebound from multi-year lows as Federal Reserve Chairman Jerome Powell signaled a cautious policy approach at the ECB’s Central Banking Forum in Sintra. Powell reiterated a “wait-and-see” strategy, citing inflation uncertainty and the need for further labor data before acting.

Additionally, the JOLTS Job Openings and ISM Manufacturing PMI both beat expectations:

• Job Openings (June): Unexpected increase
• ISM Manufacturing: Production index entered expansion
• Prices Paid: Uptrend indicates inflation persistence

These data points gave the USD a lift, curbing downside risks as markets await Wednesday’s ADP jobs report and Thursday’s Nonfarm Payrolls (NFP).

Euro Under Pressure from ECB Dovishness and Weak Labor Data

The Euro (EUR) slipped as investor sentiment was dampened by:

• Rising Eurozone unemployment in May
• Dovish ECB member comments
• Uncertainty around policy easing amid weak demand

Although German factory activity improved and CPI data remained on track, the overall tone remained cautious, failing to lift the common currency.

EUR/USD Technical Outlook

The pair faces immediate support at 1.1720, with potential extension toward 1.1675 if US data beats expectations. Resistance now stands at 1.1800, a critical psychological level and recent rejection point.

Related Tredu Articles:

• ADP vs NFP: What Traders Should Watch This Week
• What Powell’s ECB Speech Means for EUR/USD
• ECB Dovish Signals: Are Rate Cuts Still on the Table?