The US dollar strengthened in the New York session yesterday as the US (US) services PMI data released showed an increase in April after falling to a 9-month low in March.
In the previous session, the US dollar started the week on a gloomy opening as uncertainty over the development of the global tariff war remained the focus of investors.
Investors remained cautious in the market heading into the FOMC meeting early Thursday morning for the latest interest rate decision, with the main focus on follow-up comments by Federal Reserve (Fed) Chairman Jerome Powell.
He continued to be pressured by President Donald Trump to cut interest rates.
Examining the price movement on the EUR/USD currency pair chart, the price started to rise in the Asian session yesterday Monday morning from the 1.13000 level before continuing into the European session to reach a high of around 1.13600.
However, the price direction changed in the next session following the publication of ISM survey data which made the US dollar stronger again.
The price was pushed back down to 1.13000 again and remained hovering in the support zone until trading resumed in the Asian session this morning (Tuesday).
The price movement below the Moving Average 50 (MA50) resistance line on the 1-hour timeframe on the EUR/USD chart gave a bearish signal ahead of the FOMC.
If the price slides lower than the 1.13000 support zone, it is likely that the price will head towards around 1.12000 which was the focus before.
A more pronounced bearish movement could push the price down to the next focus zone at 1.11000.
On the other hand, if the 1.13000 zone manages to bounce off the price again like the situation last week, the price increase will try to head back to the 1.14000 resistance zone.
Breaking through the zone will change the direction of the price movement trend to head upwards again before the 1.15700 high reached in April is challenged again.
