Will the price movement on the chart of the EUR/USD currency pair continue to rise? Be patient, read this description.
Yesterday published in the New York session US inflation data showing a declining reading figure despite not meeting the expected decline. As expected, the declining inflation rate pushed the value of the US dollar down as well.
In addition, rising global stock markets as well as a decline in US 10 -year treasury yields added to the pressure on the US dollar.
However, these factors are not enough to fully support the price increase on the EUR/USD chart.
This is because the Euro currency also weakened following the results of the European Central Bank's (ECB) monetary policy meeting yesterday.
Based on the statement following the meeting, the ECB is seen to continue to maintain a loose policy to support the economy and this will have a depreciating effect on the Euro currency.
As a result, investors failed to see an energetic surge on the EUR/USD chart yesterday instead moving flat following expectations of declining performance for both currencies.
The price on the EUR/USD chart is seen falling testing the 1.21500 level before rebounding to the 1.21900 level in the New York session. The price returned slowly closing the trade below the 1.21800 level in the focus zone.
Continuing trading in the Asian session on Friday morning, the price was seen but the movement was still slow above the support level of the Moving Average 50 (MA50) on the 1 -hour time frame of the price movement which gave an early signal for a higher rise.
Rising prices will re-test the resistance zone at 1.22500 which still failed to break after being tested for the last 2 weeks in a row.
Beyond the zone, the price is expected to test the high of 1.2300, recording the latest 5 -month high.
On the other hand if the price makes a decline below the zone 1.21800-1.21500, the support zone at 1.20900-1.20600 will be the next price focus.
And for a lower decline, investors will evaluate the price reaction after the price hits the 1.20000 level.
