After showing a significant decline following last Friday’s NFP report, the US dollar was seen failing to maintain its bearish momentum at the opening of trading earlier this week.
The United States (US) market was also closed on Monday in conjunction with the Independence Day celebration which also caused a slow movement of prices.
Analysts are of the view that investors still see there is room for the Federal Reserve (Fed) to tighten policy after the rate hike projections in 2022 and 2023 at the most recent FOMC meeting.
The minutes of this week’s FOMC meeting will be scrutinized in addition to key US economic data such as the ISM survey services PMI will be the focus.
Examining the price movement on the chart of the EUR/USD currency pair, the price moved horizontally at the beginning of the week failed to continue the surge displayed last Friday.
Yesterday's price increase only reached a high of around 1.18800 which was also the resistance level in last Thursday's trading.
Despite the weak move, the movement above the support level of the Moving Average 50 (MA50) on the 1 -hour time frame on the EUR/USD chart still signals a price increase.
The rally is still expected to test the 1.19000 resistance zone before continuing higher if the US dollar remains weak.
The rise can reach up to the focus level at 1.2000 which is seen as the SBR (support become resistance) zone.
However, if the rise fails to hold and the price resumes the decline, the support zone at 1.18000 will be re -targeted.
A lower drop below that zone will give a clearer signal for the price to continue moving in a bearish trend.
