Trading earlier this week saw a significant depreciation of the US dollar against other major currencies amid market uncertainty awaiting a clearer answer to the US economic stimulus package discussion.
The risk-on sentiment at the beginning of the week was supported by Chinese economic data published in the Asian session which showed a recovery in the consumer sector in China and also injected the strength of the Yuan to reach its highest level since July 2018 trading.
However, investors remain wary of trading until the end of the week as market sentiment is still threatened by US stimulus package factors, the increase in Coronavirus cases and the protracted Brexit issue.
Although the Euro currency is still considered risky, the price chart of the EUR / USD pair yesterday managed to show a price spike of up to 90 pips daily increase recorded.
The price jumped from above the level of 1.17000 above the barrier level of Moving Average 50 (MA50) in the 1 hour time frame of price movement and penetrated the level of 1.17200 in the SBR zone (support become resistance).
With the strong momentum of the uptrend in the European session, the price returned to test the SBR zone below the level of 1.18000 which was the previous concentration zone.
However, prices closed lower below that zone at the end of the New York session.
The continued rise will pass the SBR zone of 1.18000 before testing the resistance level of 1.18300 reached in the previous week's trade.
A higher rise is expected to re-reach the focus level at resistance 1.19000.
On the other hand, if market sentiment returns to risk and drives the strengthening of the US dollar, the price will be pressed lower again to the expected level of 1.17200.
Next last week's support zone around 1.16900 will be tested again and investors will examine whether the price is able to continue lowering from the zone.
