EUR/USD Starts Heading Down, Signs of a 'Bearish' Pattern Starting?


Analysts assess that there will be a change in the price pattern on the main charts this week after the movement signal of the US dollar currency.

After not continuing the decline like last week, the US dollar started to show recovery again with the initial strengthening seen in yesterday's New York trading session.

The market is likely to focus again on the monetary policy of the Federal Reserve (Fed) after the hawkish tone of the FOMC meeting last week.

Like other members of the Fed, Minneapolis Fed President Neel Kashkari who expressed his views was also hawkish in that he saw interest rates need to be maintained longer as inflation has not reached the target.

Examining the price movement on the EUR/USD pair chart, the 1.08000 level remains a resistance for the price after last week's surge tested that level.

In yesterday's New York session, the price started to move down below the Moving Average 50 (MA50) barrier line on the 1-hour time frame on the chart and triggered the initial signal of a bearish trend change.

The price drop, although slow, is still seen to continue until the Asian session this morning (Wednesday) reaching around 1.07400 as of 11am local time.

With the current pattern, the price is expected to continue its decline towards around 1.07000.

If it breaks through that level, the next drop target is at the 1.06000 support zone.

However, if the price bounces back to make an increase again, the 1.08000 resistance becomes the focus level to test the price.

If the price breaks through successfully, the latest high level will be recorded with the target of a higher price increase being to reach 1.09000.