After digesting the release of the United States (US) inflation data last Wednesday, the US dollar currency showed strengthening in continued trading in the New York session yesterday.
Paying attention yesterday was the publication of the producer price index (PPI) data which managed to register a positive monthly increase, although slightly lower than forecast.
Meanwhile, the report for unemployment benefit claims in the US recorded a jump for the previous week.
Even so, the US dollar managed to strengthen significantly yesterday as market analysts still see the Federal Reserve (Fed) heading towards policy easing.
This can be observed on the price pattern on the chart of the EUR/USD currency pair yesterday which shows that the decline continues to lower levels.
After breaking the level recorded last week, the price has reached the 1.09000 support zone as expected to test the important zone.
Prices began to level off in that zone at the close of the New York session and remained sluggish following the opening of the Asian session this morning (Friday).
The signal for price movement remains bearish where the price continues to move below the Moving Average 50 (MA50) barrier level on the 1-hour time frame on the EUR/USD chart.
As previously predicted, if the decline continues, the price is seen to head towards the lower support zone of 1.08000.
If the zone is also broken, the target will shift at 1.07000 with bearish movement continued by the price.
On the other hand, if there is a surge at the end of this week, the 1.10000 level will be the focus to be tested again.
Meanwhile, the price that crosses the MA50 barrier will trigger early expectations for further movement trend changes.
The upside could re-reach the resistance zone at 1.10800 which has been tested in previous weeks but has yet to be broken.
