October 5, 2021

Is EUR/USD 'Ready' To Go Higher?

 The US dollar continued to weaken at the market opening this week before declining slightly at the end of the New York session yesterday and continuing into the Asian session today (Tuesday).

Yet the crisis experienced by Evergrande at this point is still haunting investors who are signaling risk-off market sentiment and at the same time can provide support to the USD safe-haven currency.

Investors also remain wary of the publication of the US NFP employment data report this weekend which is the focus of the Federal Reserve (Fed) and will influence the decision for policy tightening (tapering).

Monitoring the price chart of the EUR/USD pair, the price movement has already increased to the level of 1.16400 in the New York session yesterday at a time of weakness in the USD.

While heading towards the end of the New York session yesterday and continuing until the Asian session today (Tuesday), the price is seen to be slightly down to re -test the RBS (resistance become support) zone of 1.16000.

However, the price movement is still seen to show an uptrend pattern and at the same time is forming the latest HL (higher low).

If the price continues to maintain the uptrend, the SBR (support become resistance) zone of 1.17000 will still be the focus zone for investors to assess to monitor further price movements.

A more aggressive surge is likely to see the price move back towards the SBR high zone around 1.18000 and create the latest 2 -week high.

But it is also possible that if the USD strengthens again, the decline is expected to retest the 2021 lows reached last week around the 1.15700 level.

The decline to the lowest level will indirectly mark the uptrend pattern displayed on the EUR/USD price chart to plunge back to reach the support zone of 1.15000.

Investors will also be monitoring the release of the US services PMI data of the ISM survey to be published tonight which will also affect the movement of the USD.