Continuing trading on Tuesday, the US dollar is still seen to be strengthening in the New York session yesterday but at a more cautious pace.
This is because the question of monetary policy setting by the Federal Reserve (Fed) is still mixed.
The positive economic data published by the United States (US) triggered expectations for the central bank to continue policy tightening.
However, it should be remembered that last week the Chairman of the Fed, Jerome Powell himself had a dovish tone announcing that it is time for interest rate hikes to be slowed down.
The market sentiment is seen as starting to be risky again and supports the US dollar to move stronger in the market at the moment.
Despite the easing of movement restrictions reported in China, activity in China's service sector fell to a 6-month low.
The tension between Europe and Russia regarding the oil price limit as well as the issue of the Russia-Ukraine war that is heating up again is seen as one of the factors that invite renewed concern in the global market.
The price chart of the EUR/USD currency pair is seen continuing its decline to lower levels in the New York session yesterday after there was an initial increase in the previous European session.
The price that rose to around 1.05300 then plunged 70 pips to rest at 1.04600 and the price slowed until it continued into the Asian session this morning (Wednesday).
Still stuck below the Moving Average 50 (MA50) barrier level on the 1-hour time frame on the EUR/USD chart, the price is expected to continue the bearish trend towards the next target at 1.04000.
Continuing the decline lower will push the price towards the 1.03000-1.02400 zone.
On the other hand, if the price bounces back past the resistance at the 1.05000 zone and the MA50 barrier, expectations are rekindled for the price to continue the bullish trend of the past week.
The increase will continue to go back to the target of the 1.06000 resistance zone that was almost challenged by the price earlier this week.
