The Euro currency managed to record an increase to a 13-week high against the US dollar which had experienced a significant decline last week.
Why did the US dollar fail to maintain its strength after the decision to increase interest rates by 75 basis points for the fourth time in a row at the latest FOMC meeting?
This is following the dismal reading of the United States (US) NFP employment data report and also the declining US inflation data in the latest issue.
Following that, the market has been expecting that the Federal Reserve (Fed) will start to slow down interest rate hikes for the next meeting in December.
However, investors remain alert for a change in direction for the US dollar again due to the still risky market sentiment that could affect the US dollar's recovery.
The price chart of the EUR/USD currency pair has seen prices surge in the past week past the 1.01000 resistance zone.
On Friday, the price showed a daily gain of around 200 pips over the 1.03000 resistance and finally reached the latest high at the end of the session around 1.03600.
Continuing the trade at the opening of the beginning of the week with slow movement, the price is hovering above the 1.03000 zone with the expectation that the rise will continue.
For the target of a higher increase, the 1.04000 level is seen to be tested for the price to record the latest 19-week high level, which is the highest since the beginning of last July.
Next, the continued increase will lead to the next resistance at around 1.05000.
Meanwhile, for the expectation of a possible price drop, a drop below the 1.03000 level will push the price back up to 1.01000 to test the RBS (resistance become support) zone.
After the bearish trend change signal is assessed, only then is the price expected to head back to the 1.0000 parity zone.
