Risky market sentiment continued to haunt the market earlier this week with the development of Russia’s protracted aggression on Ukraine and the ongoing third round of negotiations seen to still end gloomily.
The difficulty of easing pressure on financial markets at this time will continue to give an advantage to safe-haven trades such as the US dollar which showed a strengthening earlier in the week in addition to gold seen hovering at recent highs.
The strengthening of the US dollar in a risk-off situation will continue to put pressure on the movements of other major currencies in the market particularly the Euro.
The price movement on the chart of the EUR/USD currency pair on Monday saw the price move flat with the latest low of the price almost touching the 1.0800 level.
The strengthening momentum of the US dollar was successfully maintained after the US NFP jobs report was published strong last Friday, pushing the price to continue moving in a bearish trend below the Moving Average 50 (MA50) barrier level in the 1 -hour time frame.
The 1.0800 level is still a support zone for the price at the moment, but analysts see the tendency of the price to continue to decline lower will break through the zone.
Further decline in the price is expected to lead to the level of 1.07000 to continue to record the latest low after the last time the price reached that level in March 2020.
If the decline ends and the price exhibits an initial bullish pattern past the MA50 barrier, investors need to be prepared for a reversal of the price bullish trend.
The initial rise in the price is seen to test the resistance at 1.1000 before the continued rise will test the SBR zone (support become resistance) around 1.11300 and further to the focus level of 1.12000.
As for the Euro, investors are also wary of the outcome of the European central bank's (ECB) policy meeting on Thursday.
