The US dollar showed strengthening at the close of trade last week, paring losses recorded as the market reacted to the release of US inflation and producer price data that week.
In addition to profit-taking, the initial strengthening of the US dollar has also been supported by US consumer sentiment survey data published in the last trading session last week with readings that rose above forecasts.
However, investors are cautiously assessing the movement of the US dollar this week while some data to watch out for include US retail sales and FOMC meeting minutes.
Examining the price movement on the chart of the EUR/USD currency pair, the price has given an indication of a change in trend after a bearish pattern was displayed at the end of last week.
With that, the Euro currency is seen to move back on its declining track while the development of the energy crisis that is getting longer between Europe and Russia continues to be monitored by investors.
The price that has fallen below 1.03000 has reached back to the support level at 1.02400 which at the beginning of last week was a resistance level for the price.
The price moving below the Moving Average 50 (MA50) barrier on the 1-hour time frame on the EUR/USD chart also signals a change in the bearish trend.
If the price continues to decline below the 1.02400 level, the next concentration level of the price is seen to be at 1.01600 or 1.01000 to be tested.
The price drop that continues past the zone will aim back at the 1.0000 support zone.
On the other hand, if it makes an increase at the beginning of this week, passing the resistance at 1.03000 will retest the high level reached last week around 1.03600.
Next, the resistance zone at 1.04000 is expected to be reached by the price to record the latest 6-week high level.
