EUR/USD Soars Past Neckline on Weak US NFP, Signals Bullish Breakout

Chart pattern- Inverse Head and Shoulder pattern

Neckline - 1.17284.

EUR/USD broken neckline after dismal US Non-farm payroll data on Friday.  It hit an intraday high of 1.17778 and is currently trading around 1.17657. Overall trend remains bullish as long as support 1.1575 holds. 

Following an underwhelming August Non-Farm Payroll (NFP), the US 10-year Treasury yield fell significantly from 4.10% on September 5, 2025, to 4.05% by September 8. The report revealed just 22,000 jobs created, much less than the anticipated 75,000. With markets pricing in a possible 50-basis point interest rate reduction in September, up, this weak data raised expectations for a more dovish Federal Reserve. starting at 25 basis points before the release. With decreasing bond yields, a depreciating US dollar, and an early equity rise, the yield fall, which broke under the critical technical level of 4.18%, set off a risk-off market reaction. This trend emphasizes a change in interest rate expectations and spotlights how the NFP serves as a worldwide catalyst, indicating labor market softening and strengthening the case for Fed rate reductions till September 2026.

The pair is holding above the 55 EMA, 200 EMA, and 365 EMA in the 1-hour chart. Near-term resistance is seen at 1.1780; a break above this may push the pair to targets of 1.1800/1.1835/1.1900. On the downside, support is seen at 1.1700; any violation below will drag the pair to 1.1660/1.15750/1.1545/1.1480/1.1435.

Market Indicators and Trading Strategy

Commodity Channel Index (CCI)-  Bullish

Average Directional Movement Index (ADX) - Bullish

 It is good to buy on dips around 1.1750 with a stop-loss at 1.1700 for a target price of 1.1835/1.1900.