Investors started getting signals for price trend changes on the charts of major currency pairs on Tuesday yesterday.
The US dollar returned to a weak move from a 3 -and -a -half -month high following US bond yields which returned to decline.
This situation has left room for other major currencies in the market to rebound despite the uneven strengthening exhibited.
Examining the price movement on the chart of the EUR/USD currency pair, the price showed a rebound after a series of continuous declines over the past 2 weeks hitting a low of around 1.18340.
However, it can be seen that the price made an increase from that level in the Asian session yesterday to re -test the 1.19000 level in the SBR zone (support become resistance).
While the price movement is still in a bearish trend and has not yet broken the SBR zone of 1.19000, the price increase that passed the Moving Average 50 (MA50) barrier on the 1 hour time frame gives an early signal for a trend change.
Still, the Euro currency is not expected to show a significant improvement while investors are cautious ahead of the outcome of the European central bank’s policy meeting on Thursday.
The price moved flat below the 1.19000 level in the New York session until continuing into the Asian market session on Wednesday.
If the price moves higher past that zone today, investors will be more confident to expect the price to continue to rise higher.
The next price increase will test the resistance zone at 1.19500 before heading to the SBR zone of 1.20000.
On the other hand if the US dollar re -strengthens and pushes the price lower, the downtrend will test the support level of 1.18340 before hitting the latest low on the continued decline is expected to the price zone of 1.18000.
