The significant strengthening of the US dollar towards the end of the New York session has weighed on most of the other major want points in the market.
U.S. retail sales data published in the New York session yesterday recorded a high reading for August surpassing expectations and the previous month’s reading.
Investors reacted positively to the data report rekindling expectations for the Federal Reserve (Fed) to implement policy tightening while supporting the movement of the US dollar in the market.
On the chart of the EUR/USD currency pair yesterday, the price showed a decline since the Asian session to hit the latest 3 -week low with a daily decline of around 70 pips recorded.
The decline hit around 1.17500 in the New York session before a horizontal price movement above that level continued into the Asian session on Friday morning.
Expectations of a rebound will test the resistance at the level of 1.18000 before the price continues lower.
The support zone at 1.17000 is expected to be the focus of continued price declines likely to continue in next week’s trading.
On the other hand if the price jumps past the resistance of 1.18000 and signals a reversal of the bullish trend of the price, the bulls are expected to head back to the resistance zone at 1.19000 which was tested in the previous weeks.
