In the pace of economic normalization, investors are adjusting their holdings depending on expectations rather than unbiased data. How long investors ignore the economic facts and not consider the current situation remains unknown as markets have the tendency to retard making rational decisions. On the back of the first wave of Coronavirus, unemployment in US and Euro Zone has peaked dramatically, while the manufacturing and services sector dipped to such lows that traders cannot avoid thinking about how and when recovery might happen.
Germany’s unemployment data shows a swift rise but the same is true for the US too. Likewise, although manufacturing seems to recover on both sides, it is far from offering a positive mood to the investors. In the face of today’s economic data announcement, traders will assess how quickly unemployment will begin to fall and get closer to its recent lows. As Germany’s unemployment data shows a significant rise at a time when the overall decline in the unemployment level in the entire Euro Zone has been losing its downward momentum, it is evident that the employment issue may put some pressure on the pair. However, the uncertainty about US durable goods orders, the composite PMI, and ADP employment change may force traders to wait on the side until the data are announced. In case US data shows further economic weakness in the face of political uncertainty and social distress, traders may not be so willing to sell the EURUSD. From this perspective, the market will look to buy the pair after seeing some lows during today’s session.