Risky market sentiment has made investors start to be cautious in the market and gave the US dollar an advantage to continue to strengthen.
The United States (US) NFP employment data report for the month of September published last Friday was evaluated positively with a good increase in employment compared to expectations and also a decrease in the unemployment rate.
This has increased investor confidence that the Federal Reserve (Fed) will continue its monetary policy tightening measures at the upcoming policy meeting.
Adding to the advantage for the US dollar as a safe-haven currency as reports of heated war between Russia and Ukraine peaked again over the weekend.
After the reported explosive attack on the Crimea Bridge that was believed to be an act by Ukraine, Russia did not stay silent to respond with missile attacks on major cities in Ukraine targeting energy and communication systems.
Thus, the US dollar is expected to continue to put pressure on most other major currencies at the opening of the market earlier in the week.
As observed by the price movement on the EUR/USD currency pair chart on Monday yesterday, the price continued to decline lower at the beginning of the session before the price movement started to level off in the New York session around the 0.97000 zone.
The price trend remains bearish with the price still moving below the Moving Average 50 (MA50) barrier level on the 1-hour time frame on the price chart.
With the energy crisis still lingering in Europe, it is likely to increase the pressure for the Euro currency to resist the urge to strengthen the US dollar.
Analysts see a tendency for the price to drop lower below the 0.97000 zone with a target to reach the 0.95500 support zone.
The 0.95500 zone hit at the end of September became the lowest price zone for the 20-year trading period.
However, investors still need to be careful if the price rebounds from the 0.97000 zone.
A price break above the MA50 barrier will signal a change in the price trend before heading towards the 0.98000 resistance.
A further move higher has the potential for the price to reach the 0.99000 level again or return to the 1.0000 parity zone.
